UIP-4: Staking Usual DAO Treasury Assets into USUALx

UIP-4: Staking Usual DAO Treasury Assets into USUALx

Category: Protocol Treasury Management

Authors: Usual Labs Core Contributors

Date: 2025-03-19

Status: Proposed

1. Summary

The Usual DAO treasury currently holds USUAL tokens accrued from Early Redemption fees on USD0++. Half of these tokens are allocated for future redistribution to USUALx holders. In the meantime, however, they remain unstaked, which leads to dilution of value for existing USUALx stakers as new emissions continue to be distributed.

This proposal seeks to stake the portion of treasury-held USUAL (approximately 37.6M USUAL) that belongs to USUALx holders into the USUALx staking contract. This ensures that these tokens actively retain their value within the staking mechanism rather than being passively diluted.

Both the principal and any rewards accrued from staking (USD0 + USUAL) will ultimately be redistributed to USUALx holders. This is strictly a temporary measure to safeguard the value of these assets while awaiting redistribution, which remains scheduled for the 12/31/2025 at the latest.

Approval or rejection of this proposal does not affect the timing of the redistribution.

2. Proposed Specifications

Stake the USUAL Holdings Belonging to USUALx Holders
The USUAL tokens held in the DAO treasury, originating from Early Redemption fees and allocated to USUALx holders, will be staked into the USUALx contract. This ensures they continue to generate rewards and prevents dilution while awaiting redistribution.

Accrual of USD0 and Additional USUAL
Staked USUAL will earn additional USUAL and USD0 through the protocol’s revenue-sharing mechanism. These rewards will also be redistributed alongside the principal during the future distribution process.

Exclusion from Governance Voting
To prevent conflicts of interest, the USUALx held by the treasury as a result of this proposal will not be used for governance votes.

No Impact on the Timeline of Redistribution
Staking these assets does not delay or accelerate the planned redistribution, which remains scheduled for the 12/31/2025 at the latest. The purpose of this proposal is purely to protect value in the interim.

• If this passes: The USUAL is staked to prevent dilution, and both the principal and any generated rewards will be redistributed on the intended schedule.
• If this is rejected: The USUAL remains unstaked in the treasury, but will still be distributed on the same timeline.

Redistribution Details
The redistribution of both the principal and accrued rewards will take place by the 12/31/2025 at the latest. The allocation will be based on historical staking balances, ensuring that rightful USUALx holders receive their proportional share regardless of when the redistribution occurs.

No action is required from stakers to secure their entitlement, as the distribution will follow a transparent and fair process aligned with past staking participation.

No Additional Unstaking Fee Introduced
Redistributed USUAL will follow the existing staking reward mechanism, meaning that recipients would need to unstake to claim them regardless of whether this proposal passes. Staking them in the interim does not add any extra fees or steps beyond what would already apply.

3. Concerned Contracts

• DAO treasury : The treasury already accrued USUAL from the USD0++ early unstaking. The address is 0x81ad394C0Fa87e99Ca46E1aca093BEe020f203f4
• USUALx (staking contract) : The address is 0x06B964d96f5dCF7Eae9d7C559B09EDCe244d4B8E
• Checking accrued USUAL: Usual tokens accumulated through the USUALx unstaking function. The amount could be checked here at this contract address, looking at the getAccumulatedFees method in “read as a proxy” : 0x06B964d96f5dCF7Eae9d7C559B09EDCe244d4B8E

4. Voting Procedure

Eligibility
Only USUALx holders are eligible to vote on this proposal, as it exclusively concerns the portion of treasury-held USUAL allocated to them. USUAL* and USD0++ holders do not have voting rights on this proposal. A separate and identical governance proposal will be made to determine the handling of USUAL allocated to USUAL*.

Voting Mechanism
This proposal will be decided by a simple majority vote. The option receiving the highest number of votes will determine the outcome.

Vote Options

• Yes – Approve staking of the treasury-held USUAL allocated to USUALx holders to prevent dilution while awaiting redistribution.
• No – Reject the proposal and leave these USUAL tokens unstaked in the treasury while awaiting redistribution.
• Abstain – Participate in the vote without expressing a preference.

Voting Period
The vote will be open for 3 days. Please find the precise timeline on Snapshot UI.

5. Conclusion

This proposal is a protective measure for USUALx holders. It prevents dilution of their rightful assets without impacting their ability to claim them when redistribution occurs.

• All assets will be fully redistributed (both USUAL and USD0 rewards).
• No additional fees or penalties are introduced, mirroring the existing distribution method.
• Governance power from these assets will not be used by the DAO.
• This does not delay or accelerate redistribution: it simply safeguards value in the meantime.

By approving this proposal, we ensure that rightful USUALx holders receive their full value when redistribution happens by the 12/31/2025 at the latest.

We invite all community members to review, discuss, and participate in the governance process.

Thank you for your participation in shaping the future of Usual Protocol!

Disclaimer: Final parameters and details may be adjusted based on community feedback and further risk assessments. All aspects of this proposal are subject to veto or revision.

Proposed by:

Usual Labs Core Contributors

2025-03-19