Protocol Revenue Model

The USDU Finance protocol is designed to generate sustainable on-chain revenue through its active role in lending markets and liquidity provision, rather than by charging users direct fees.

How USDU Finance earns revenue:

• The protocol governance can propose minting modules that mint $USDu into strategic markets (such as Curve pools or lending protocols).

• When $USDu is provided as lending liquidity, the protocol receives yield-bearing positions (for example, LP tokens or lending vault tokens).

• Interest paid by borrowers on this liquidity results in a steady revenue stream to the protocol.

Revenue Uses:

• A portion of protocol income is used to:

  • Support liquidity incentives in key markets (for example, bribes on Curve or Morpho)

  • Subsidize borrowing rates when needed to attract demand

  • Expand adoption and integrations of $USDu in DeFi

  • Strengthen the protocol treasury for long-term resilience

Key Design Principles:

• The protocol itself earns revenue without charging users deposit fees or performance fees in the $USDu Lending Vault.

• Revenue scales with overall lending activity and demand for $USDu liquidity.

• All protocol minting and liquidity provision actions require governance approval through formal modules.

Summary:

The USDU Finance protocol monetizes by actively participating in DeFi lending and liquidity markets and using that income to fuel ecosystem growth, drive adoption, and create a positive flywheel effect for $USDu.