Can Usual’s revenue switch deliver on its promises, despite growing concerns?
The Revenue Switch, a mechanism designed to distribute 100% of Usual’s (USUAL) protocol revenue to USUALx stakers, has been launched by the creators of the USUAL token and USD0 stablecoin ecosystem. While the initiative represents a significant step forward for decentralized finance, its debut comes amid ongoing community concerns about recent changes to the protocol’s repayment feature.
Activated on January 13, 2025, the Revenue Switch allows USUALx stakers to receive revenue generated by the protocol, estimated at $5 million per month, directly in USD 0. This mechanism links symbolic value to actual revenue, with the goal of encouraging long-term staking and supporting sustainable protocol growth.
As of January 14, 2025, the USUAL token is trading at $0.5319, with a market cap of $275.68 million and a 24-hour trading volume of $194.6 million. Approximately 36.53% of the token supply has been staked, delivering an annualized return of 275%, 42% in USD0 rewards and 233% in USUAL.
Despite the excitement surrounding the Revenue Switch, the protocol has received criticism for its decision to update the redemption feature for USD0 stablecoins. The new feature allows a temporary suspension of refunds under specific circumstances, such as during periods of market volatility or liquidity constraints. While USUAL has clarified that this change is intended to maintain stability in extreme scenarios, it has raised concerns about the concentration of control and possible implications for decentralization.
The introduction of the Revenue Switch and adjustments to the redemption feature are part of USUAL’s broader strategy to secure its position as the leading DeFi protocol. The Revenue Switch aims to increase the utility of USUAL tokens, stabilize returns for stakers, and provide a transparent revenue distribution mechanism. USUAL has also indicated plans to refine its model in the coming months, incorporating advanced staking and governance frameworks inspired by the “veModel” used in other DeFi projects.
As USUAL navigates these developments, the success of the Revenue Switch could serve as a proof of concept for revenue-based tokenomics, potentially influencing future industry practices. At the same time, the protocol’s response to community concerns will be closely watched as it could impact trust and adoption in an increasingly competitive DeFi ecosystem.
