Introducing Staked dUSD (sdUSD)

Minh Nguyen
Aug 4
3 min read

dTRINITY has officially launched its YBS (yield-bearing stablecoin)! 🚀

Introducing Staked dUSD (sdUSD), a YBS version of dUSDthat aims to deliver above-market yields from collateralized stablecoin lending. Now live on Fraxtal and Sonic—coming soon to Ethereum, Katana, and other networks where dUSD is deployed.

How It Works

sdUSD is dTRINITY’s liquid ERC4626 vault for staking dUSD. Vault assets are automatically supplied to dLEND,the protocol’s native lending marketplace, to earn yield and rewards. Therefore, sdUSD holders are effectively dUSD lenders.

Chain-Isolated Vaults

Similar to dUSD’s chain-isolated reserves and non-fungibility across different networks, sdUSD is also not fungible cross-chain (e.g., Fraxtal sdUSD ≠ Sonic sdUSD). This separation exists by design because dTRINITY maintains isolated reserves and staking vaults on every chain it’s deployed on, preventing cross-chain contagion risk while strengthening reserve and vault integrity on each chain.

For example, if dTRINITY expands to an exotic chain and experiences a localized security incident or economic imbalance there, the impact would remain fully contained within that chain’s ecosystem. Neither dUSD or sdUSD on other chains would be affected.

Vault Strategy

dLEND dUSD deposits integrated by the vault are secured by multi-collateral, ranging from BTC and ETH assets to LST, YBS, and derivatives curated by dTRINITY based on their qualities, yield profiles, and risk characteristics. Generally speaking, these collateral assets include:

Network tokens like WETH (Ethereum), FRAX (Fraxtal), S (Sonic)
Top LST assets on each network like frxETH & sfrxETH (by Frax), scETH & wstkscETH (by Trevee), stS (by Beets), wOS (by Origin)
Top YBS assets on each network like sfrxUSD (by Frax), sUSDe (by Ethena), sUSDS (by Sky), wstkscUSD (by Trevee)
Top stablecoin derivates like PT-wstkscUSD (by Pendle)

To manage risk, dLEND’s max LTV (loan-to-value) thresholds for borrowing dUSD are capped between 60–80%, lower vs. higher thresholds commonly found on other lending protocols (as high as 90–95%). Collateral rehypothecation on dLEND is also disabled by default to mitigate bad liquidation and nested leverage risks. Additionally, price oracles for dLEND are optimized with fundamental feeds to mitigate market liquidity risk from LST and YBS collateral.

In the future, sdUSD’s vault strategy will be diversified by incorporating dUSD markets on other blue-chip lending protocols beyond dLEND (e.g., Silo, Morpho).

Staking & Unstaking

Users can stake/unstake dUSD permissionlessly and atomically. There is no staking fee. Unstaking has a 0.1% fee and is based on available liquidity from integrated lending markets.

When users stake dUSD into the vault, they receive composable, fungible receipt tokens (sdUSD) that unlock secondary market liquidity for dUSD lending deposits. Thus, sdUSD can be supplied into other DeFi money legos like DEXs, lending markets, and derivative protocols, enabling more utilities and yield-stacking opportunities for users.

Enhanced Yields

Thanks to dTRINITY’s unique borrower subsidy mechanism, dUSD lending markets typically have elevated utilization rates, which generates sustainable, above-market yields for dUSD lenders and sdUSD holders.

Learn more about dTRINITY’s subsidy mechanism here.

sdUSD Use Cases

Hold sdUSD to earn native yield & rewards from underlying dUSD lending markets.
Provide liquidity for sdUSD on DEXs (e.g. Curve, Beets) and yield marketplaces (e.g. Pendle, Spectra) to stack earnings from trading fees & DEX emissions on top of native yield & rewards.
Stake sdUSD LPs to boost yields with Curve meta-governance protocols (e.g., Stake DAO, Convex)
Earn fixed-yield via PT-sdUSD from yield marketplaces.
Earn leveraged variable yield via YT-sdUSD from yield marketplaces.
Loop sdUSD (as collateral) with stablecoin-denominated debt on lending protocols to amplify native yield & rewards with leverage.
Loop PT-sdUSD (as collateral) with stablecoin-denominated debt on lending protocols to amplify fixed-yield with leverage.

Note: sdUSD and PT-sdUSD loopers who borrow dUSD are not subsidized in order to mitigate subsidy arbitrage.

What is dTRINITY?

dTRINITY, short for DeFi Trinity, 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 exogenous reserves. dUSD is the first demand-centric stablecoin where reserve earnings are distributed as interest rebates to its borrowers.

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.

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

📢 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.