Algorithmic / under-collateralized stablecoin
Usual (USD0 / bUSD0 / USUAL)'s assessment for RD-F-069 — scored yellow on the v1.7.0 rubric. The evidence below is the curator's reasoning for this score.
Evidence summary #
USD0 (base stablecoin) is fully collateralized 1:1 by tokenized T-bills (USYC ~83.96%, USTBL ~16.04%); not algorithmic or under-collateralized. However, bUSD0 (formerly USD0++, the locked bond layer) introduces a novel economic risk: (1) bUSD0 holders cannot exit 1:1 unconditionally before June 11, 2028 maturity — they must either forfeit all accrued USUAL rewards (conditional 1:1 exit) or accept a floor price ($0.87 initial, raised to $0.92 per Jan 23 blog post, current docs); (2) this floor mechanism was introduced WITHOUT prior DAO vote on January 9-10, 2025; (3) bUSD0 fell to $0.89 in secondary markets immediately after the announcement; (4) the Morpho vault LLTV of 86% sat just below the $0.87 floor, triggering cascading liquidations. Not pure-algorithmic (no LUNA-class reflexivity), but the forced-discount exit from a locked bond without governance approval is a demonstrated economic-design failure. YELLOW: USD0 layer is green (fully backed); bUSD0 layer adds a demonstrated-failu
Sources #
- URLThe Block — USD0++ depeg and governance process bypassThe Block — theblock.co/post/333995 — unilateral floor price introduction without prior DAO vote; USD0++ drops below $0.92retrieved 2026-05-17
- Usual docs — USD0 collateralization and bUSD0 floor price mechanismdocs.usual.money/llms-full.txt — 'Full collateralization — Every USD0 is backed 1:1. No fractional reserves and no leverage'; floor price $0.92 for bUSD0 early exit; PAR mechanism for extreme scenariosretrieved 2026-05-17
- Usual blog — Road to Parity (post-hoc governance announcement)Usual blog — 'A new dawn for USD0++: Road to parity' (2025-01-23) — post-hoc description of floor price change; $250M redemption via early-exit mechanism; floor raised to $0.92retrieved 2026-05-17
- OneSafe — USD0++ depegging impact and governance concernOneSafe blog — USD0++ fell to $0.89; DAO holders not consulted before floor price change; Morpho LLTV 86% near $0.87 floor triggered cascading liquidationsretrieved 2026-05-17
Methodology #
Classify whether the protocol is an algorithmic or under-collateralized stablecoin design per curator classification.
See the full factor methodology and distribution across all protocols →