dTRINITY Expands to Sonic Chain

May 7
5 min read

Updated: 5 days ago

It’s here, dGENS! We have officially launched on Sonic with the expansion of dLEND and dUSD, along with the introduction of dS—the first subsidized Sonic-pegged stablecoin 🚀

Why Sonic?

After our initial success on Fraxtal, we are now bringing dTRINITY’s subsidized stablecoin model to Sonic chain, one of the fastest growing blockchains with a rewarding ecosystem for both users and builders. By partnering with native protocols and providing users with sustainable subsidies, dTRINITY aims to reduce borrowing costs and boost credit demand on Sonic, creating superior yields while attracting more liquidity and credit supply to the ecosystem.

“Digital economies, similar to real-world economies, are all about import/export. With its expansion to Sonic, dTRINITY will gradually import exogenous liquidity and yields to generate growth and alpha natively on Sonic, which can then be wrapped and exported to power other blockchain ecosystems.” ~Kory Hoang, Head of Strategy.

What is dTRINITY?

An overview of dTRINITY’s ecosystem on Sonic

dTRINITY is the world’s first subsidized stablecoin protocol — a new primitive designed to supercharge DeFi markets.

The protocol features dUSD, a decentralized stablecoin fully backed by an exogenous on-chain reserve of price-stable, yield-bearing assets. It is also the first demand-centric stablecoin that externalizes the underlying yield to its borrowers instead of holders/stakers.

By paying users to borrow, dTRINITY is able to shift the demand curve upward, creating a higher supply-demand equilibrium that unlocks greater capital efficiency and yields for dUSD. This novel mechanism can also be applied to create subsidized crypto-pegged stablecoins (e.g., dS), producing a similar effect to subsidized USD-pegged stablecoins.

dTRINITY is live now on Fraxtal and Sonic (app.dtrinity.org). Expansions to Ethereum and other chains are coming soon!

What are dUSD and dS?

dUSD and dS are the world’s first subsidized stablecoins

Sonic dUSD is a USD-pegged stablecoin, fully backed by other USD-denominated stablecoins and yieldcoins. Similarly, Sonic dS is an S-pegged stablecoin, fully backed by Sonic (S) and S-based LSTs. These stablecoins form one of the three key components of the dTRINITY ecosystem.

Sonic dUSD: Every token is backed by 1 USD worth of reserves, initially consisting of USDC, frxUSD, sfrxUSD, scUSD, and wstkscUSD.
Sonic dS: Every token is backed by 1 S worth of reserves, initially consisting of S and stS.

The yield from each stablecoin’s reserve is used to fund ongoing interest rebates for its borrowers on dLEND — an Aave v3 fork. These rebates help lower their net Borrow APYs, boosting credit demand and utilization — ultimately raising Supply APYs for lenders as well.

Users can mint or redeem dUSD and dS permissionlessly and atomically. There is no minting fee. Redemption has a 0.4–0.5% fee.

In addition to open minting and redemption, dTRINITY optimizes price stability and liquidity for dUSD on DEXs through Stability Market Operations (SMO) and Algorithmic Market Operations (AMO). SMOs repuchase dUSD at a discount from the market using underlying reserves, typically when borrowers increase leverage. Conversely, AMOs create and sell new dUSD into the market when it’s trading at a premium, typically when borrowers deleverage. These SMO and AMO mechanisms allow dTRINITY to stabilize its stablecoins during credit expansion and contraction cycles while capturing arbitrage profits to over-collateralize underlying reserves, further strengthening stability over time.

Note: Sonic dUSD is not fungible with Fraxtal dUSD, which launched earlier in December 2024. This separation exists by design because dTRINITY maintains isolated stablecoin reserves on every chain it’s deployed on, preventing contagion risk while strengthening reserve integrity on each chain. Instead, cross-chain swaps between non-fungible dUSD tokens will soon be supported via CrossCurve.

What is dLEND?

A screenshot of the dLEND interface on Sonic

dLENDis dTRINITY’s native lending protocol — powered by subsidized stablecoins. It is the second key component of the dTRINITY ecosystem.

Lenders can supply dUSD and dS to earn yield plus rewards from dTRINITY and third-party partners. Borrowers can then supply various yield-bearing collateral to borrow dUSD and dS, some of which may earn rewards as well. In addition to paying raw Borrow APYs, these users also earn separate Rebate APYs (paid in dUSD or dS) that subsidize their net borrowing costs.

Thanks to boosted demand and utilization on dLEND — made possible by borrower subsidies — the Supply APYs for dUSD and dS will rise to above-market levels, improving yield while reducing opportunity costs for lenders. Thus, dLEND provides the ideal platform for Sonic users who:

Mint and supply (lend) dUSD and dS to earn yield + rewards
Loop yield-bearing stablecoins by borrowing dUSD to earn rebates
Loop yield-bearing Sonic LSTs by borrowing dS to earn rebates

When utilization rates are low, dUSD and dS borrowers may even experience negative Borrow APYs (net of subsidies), which means they are effectively getting paid to borrow. The lower the utilization rate, the greater the negative Borrow APY becomes due to less outstanding debt vs. available subsidies.

What a subsidized Borrow APY curve looks like

Note: Rehypothecation of supplied collateral on dLEND is disabled by default to prevent contagion risk from nested leverage during volatile markets. Additionally, dUSD and dS are disabled as borrowing collateral by default to mitigate subsidy arbitrage.

Trading & Liquidity

SwapX liquidity pools for dUSD and dS are now live on Sonic

The final key component of dTRINITY’s ecosystem are external liquidity pools for dUSD and dS on partnered DEXs like SwapXand Curve. These pools enable efficient swaps between dUSD, dS, and other Sonic assets, plus yield opportunities for LPs who contribute liquidity. They are also collateral liquidation venues for dLEND as well as market operation venues for SMO and AMO.

Thanks to subsidized borrowing demand, the velocities of dUSD and dS also get boosted as borrowers swap them on DEXs to leverage/deleverage, generating more volume and fees for LPs.

Points & Rewards

While dUSD and dS borrowers are subsidized with interest rebates, lenders and LPs earn dT Pointswhich will convert to dTRINITY’s future governance tokens during the TGE. They may also earn Sonic Points and/or other points and rewards from ecosystem partners like Rings, Curve, and SwapX.

On top of all this, dUSD and dS lenders may earn dGEMSwhich are liquid Sonic Gemsrewards tokenized via Merkl. 100% of dTRINITY’s Sonic Gems allocation will be distributed to lenders as dGEMS.

Sonic Roadmap

Partner with Frax, Curve, SwapX, Shadow, Odos, CrossCurve, Spectra, Rings, Beets, Origin, Silo, SwapX, Merkl, Turtle Club, and other protocols on Sonic
Launch subsidized dUSD and dS lending markets outside of dLEND
Launch Staked dUSD (sdUSD), i.e., yield-bearing vaults for lending strategies with tradable receipt tokens
Integrate sdUSD with tokenized yield marketplaces
Complete the 4th smart contract audit
Release a public bounty program
And more!

📢 Join the dTRINITY community to get the latest updates!

Disclaimer: dTRINITY is not available to residents of Canada, Iran, North Korea, Russia, the USA, the UK, and other restricted regions.

The information contained herein should not be considered legal, business, financial, or tax advice. Past performance is not indicative of future results. Digital assets and DeFi protocols carry significant risks, including the potential for complete loss of funds. By using dTRINITY, you acknowledge and accept these inherent risks. View our full Disclaimer and Terms to learn more about the risks involved.