sNUSD
Earning Yield
Neutrl distributes generated yield exclusively to sNUSD holders. Users stake NUSD tokens through the staking contract to receive sNUSD, which represents their proportional share of the yield-bearing vault. The sNUSD token automatically appreciates in value as yield accrues, enabling passive yield earning without requiring any manual actions from users.
Unstaking process
When unstaking, sNUSD tokens are burned and users receive their proportional amount of NUSD based on the current exchange rate.
By default, the protocol offers an instant unstaking option, allowing users to convert sNUSD to NUSD immediately. When using this option, the user transfers sNUSD and receives the corresponding amount of NUSD instantly, minus a small instant unstaking fee. This fee covers the operational cost of unwinding the underlying strategy positions required to release liquidity.
The instant unstaking fee currently starts at 1%, but it may be adjusted over time depending on market conditions and available liquidity.
This mechanism does not rely on external liquidity providers or secondary markets. Instead, the conversion is handled directly by the protocol, making the process predictable and capable of handling large transaction sizes without slippage or liquidity constraints.
Users who prefer not to use instant unstaking can select the queued unstake option, which follows the standard 10-day cooldown period before NUSD becomes withdrawable.
Yield Accrual Mechanism
Staking NUSD
- Users deposit NUSD into the staking contract
- The contract mints sNUSD based on the current sNUSD exchange rate
- Initial exchange rate: 1 sNUSD = 1 NUSD
- The exchange rate increases over time as yield accumulates
Yield Distribution
- Protocol generates yield through market-neutral strategies and revenue-generating activities
- Yield continuously flows into the staking contract, increasing total NUSD reserves
- Each sNUSD token appreciates proportionally as the vault grows
Passive Growth
- Yield accrual requires no user intervention
- Returns are automatically reflected in the increasing sNUSD redemption value
Calculation & Example
sNUSD:NUSD ratio = total sNUSD supply / (total NUSD staked + total protocol revenue deposited in NUSD terms)| Time period | sNUSD supply | Protocol revenue (NUSD) | sNUSD : NUSD ratio | sNUSD Received for 1 NUSD Staked | NUSD Received for 1 sNUSD Burned |
|---|---|---|---|---|---|
| Day 0 | 5,000,000 | 0 | 1 | 1 | 1 |
| Day 90 | 5,000,000 | 250,000 | 1.05 | 0.95 | 1.05 |
| Day 180 | 5,000,000 | 500,000 | 1.1 | 0.9 | 1.1 |
| Day 270 | 5,000,000 | 750,000 | 1.15 | 0.87 | 1.15 |
| Day 365 | 5,000,000 | 1,000,000 | 1.2 | 0.833 | 1.2 |