Example: USDv in a Lending Pool
Lending markets are inefficient when stablecoin liquidity sits idle.
In a typical lending pool, suppliers earn lending interest only when assets are borrowed. If borrow demand is low, part of the stablecoin pool remains unused and earns nothing.
USDv changes that.
USDvA user can supply USDv to a supported lending pool and continue earning the USDv base rate on eligible USDv exposure, including idle USDv sitting inside the pool.
Lending Pool Example
A supported lending pool has:
- Total USDv supplied: 10,000,000 USDv
- USDv borrowed: 6,000,000 USDv
- Idle USDv liquidity: 4,000,000 USDv
- Expected earn rate: 4%
In a normal stablecoin pool, the idle 4,000,000 USDv waits for borrow demand.
With USDv, that idle liquidity earns. At a 4% expected earn rate, the idle 4,000,000 USDv generates 160,000 USDv of annualized rewards before lending interest.
This creates a more efficient lending market:
- suppliers earn while liquidity waits for borrowers
- pools can stay deeper without leaving idle capital unproductive
- borrowers still benefit from available liquidity
- rewards can be routed to a separate destination wallet
- the destination wallet also compounds as rewards arrive in USDv
Example
A user supplies 100,000 USDv to the lending pool.
- Lending position: 100,000 USDv
- Reward destination: treasury wallet
- Expected earn rate: 4%
- Estimated annual USDv rewards: 4,000 USDv
- Estimated monthly USDv rewards: 333 USDv
The user keeps the lending position active. USDv rewards route to the treasury wallet, where they continue compounding as USDv.