Usual Protocol activates revenue switch amid redeem function debate

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Can Usual’s revenue switch deliver on its promises amid growing concerns?

The new mechanism called The Revenue Switch, developed by creators of the USUAL token and USD0 stablecoin system, has been introduced. This mechanism aims to distribute all earnings from Usual’s (USUAL) protocol directly to USUALx stakers. As a significant milestone in decentralized finance, this launch is met with ongoing discussions within the community regarding recent adjustments to the protocol’s redeem feature.

Beginning January 13, 2025, the Revenue Switch will initiate, enabling USUALx token holders to receive monthly revenue from the protocol, approximately $5 million, directly in USD. This system ties the token value to actual earnings, with the intention of encouraging long-term staking and fostering a sustainable growth path for the protocol.

Beginning from today, UTC+0, I’ve activated the Revenue Switch for USUALx holders. If you’ve maintained your USUALx holdings throughout this week, you will be entitled to receive a distribution of the collateral revenues accumulated last week.

For more comprehensive information, please refer to the following links: [here] and on our decentralized application (dApp).

In the collateral-sharing mechanism we’ve established, each USUALx you hold corresponds directly to a unit of the shared revenue.

— Usual (@usualmoney) January 13, 2025

On January 14, 2025, the current price for a USUAL token is $0.5319. The total market value of these tokens amounts to $275.68 million. In the last 24 hours, a trading volume of $194.6 million has been recorded.

Approximately 36.53% of the USUAL token supply is currently staked. This results in an annual yield of approximately 275%, with 42% of that return being paid out in USD0, and the remaining 233% being distributed back in USUAL tokens.

Although there’s a lot of enthusiasm for the Revenue Switch, the system has received criticism due to its recent decision to modify the redeem function for US dollar-pegged stablecoins. This update enables a temporary halt in redemptions under certain circumstances like during market turbulence or scarcity of liquidity. Although USUAL has explained that this alteration is aimed at preserving stability during extreme situations, it has sparked worries about the accumulation of power and potential effects on decentralization.

As a crypto investor, I’m excited about the rollout of USUAL’s new features – the Revenue Switch and updates to the redeem function. These changes are all part of their broader strategy to maintain and strengthen their standing as a top DeFi protocol. The goal of the Revenue Switch is to boost the usefulness of USUAL tokens, ensure steady returns for stakers, and establish a clear, fair mechanism for revenue distribution. Additionally, USUAL has hinted at plans to improve their model in the near future, incorporating sophisticated staking and governance structures inspired by the “veModel” seen in other DeFi projects.

In typical fashion, the progression of events will demonstrate if the Revenue Switch is a viable model for revenue-oriented token economics, perhaps shaping future trends within this sector. Meanwhile, how the protocol addresses community issues will be under close scrutiny, as it may determine trust and adoption levels in a rapidly growing Decentralized Finance (DeFi) market.

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2025-01-14 03:42