USDD is essentially an “interest-bearing wrapped USDT”
Here’s why I call it “wrapped.” Traditionally, we talk about wrapped tokens for native chain assets—for example, WTRX is wrapped TRX because native tokens often don’t meet network standards, so smart contracts can’t interact with them directly.
So why say USDD is a wrapped, interest-bearing version of USDT?
1️⃣ 1:1 Zero-loss Exchange:
USDD and USDT can be exchanged 1:1 via the PSM module, which means in terms of redemption guarantees, it behaves like a wrapped token.
2️⃣ Native Yield Protocol:
USDT itself has no native yield protocol.
USDD, however, offers native APYs up to 20%, with 12% APY currently on Ethereum and BNB Chain.
Many ask about safety—here’s the breakdown:
✅ Audited Protocol: USDD has undergone multiple audits to ensure security.
✅ Safe Underlying Strategies: Funds are allocated to the safest and most liquid deposits on AAVE, Spark, and JustLend, allowing anytime withdrawals.
✅ PSM-backed Minting: Most USDD is minted through the PSM module, so extreme market swings won’t create systemic risk. Redemption is fully guaranteed 1:1 with zero loss.
📌 Pro tip: For other stablecoins, a de-peg is a signal to run. For USDD, a de-peg can be a signal to buy, because the PSM module provides arbitrage opportunities in the market.
