OUSD AMO Funds Allocation

Summary

Whitelist a new Curve OUSD/USDC strategy and authorize the Guardian to allocate up to 100% of OUSD’s existing USDC holdings into it. The strategy will use an AMO mechanism to enhance peg stability and support protocol-aligned liquidity.

Background

OUSD currently holds USDC in the Morpho Vault strategy: Gauntlet USDC Prime. It has served as a consistent yield source for OUSD. However, to further diversify OUSD's holdings and support protocol-owned liquidity, I propose we whitelist a new Curve OUSD/USDC strategy that earns yield from trading fees and CRV emissions as a liquidity provider using only USDC.

Unlike OUSD's prior Curve strategy involving 3Crv, this new USDC-specific Curve strategy will be easier to manage operationally with less risk of stablecoin volatility. Allocations to this Curve pool can be contained with only USDC exposure while USDT and USDS exposure will be limited to their respective strategies.

Rationale

The allocation of USDC to this new Curve strategy will enable better peg stability that also aligns with the product strategy . It provides:

• Deepened liquidity: The AMO mechanism built into this strategy directly supports OUSD and deepens liquidity without introducing external platform risk.
• Flexibility: Having an additional USDC strategy provides an alternate yield source beyond the current Morpho Vault strategies.
• Improved Peg Stability : The strategy improves the peg stability of OUSD leading to improved consumer confidence.

Conclusion

This proposal helps OUSD generate market-leading risk-adjusted yield and provides a more diversified product for holders. Unless there are objections, I recommend proceeding with whitelisting the Curve OUSD/USDC strategy and authorizing the reallocation of up to 100% of our current USDC holdings into it.