DeFi—stusdGG
Staked usdGG
Staked usdGG
When users deposit USDC into the Genius Protocol, they receive usdGG, a 1:1 fully backed receipt token that passively accrues yield from cross-chain swap fees. The problem is that while usdGG appreciates in value relative to its backing (each token is worth more than 1 USDC over time), it is non-rebasing and not natively DeFi-compatible with protocols that expect fixed-value stablecoins. Holding usdGG earns yield, but it cannot easily be used as collateral or LP capital without sacrificing the underlying fee accrual benefits.
To solve this, users can stake their usdGG to mint stgusdGG, a liquid staking token (LST) that represents a claim on usdGG + accrued yield. stgusdGG maintains a fixed 1.0 unit representation, while usdGG itself appreciates in backing value. When a user wants to exit, they redeem stgusdGG back to usdGG and then usdGG to USDC, receiving the full yield earned during the staking period.
This mirrors what stETH does for Ethereum: it decouples the yield-bearing asset (usdGG) from its liquid wrapper (stusdGG), enabling seamless integration with DeFi protocols. A user can hold stgusdGG in Curve, use it as collateral in lending markets, or LP it in Uniswap-style pools – all while their position continues to benefit from swap fee revenue, abstracted away inside the usdGG backing.
Comparisons
Backing Type
Fully backed 1:1 by USDC held in protocol vaults
Centralized fiat reserves (Circle)
Same as USDC
Synthetic delta-neutral ETH + CEX perp shorts
Yield Source
Organic protocol fees from cross-chain swaps
None (0%)
Lending interest from borrowers
Funding rate arbitrage via short perps
Yield Profile
Variable, usage-based real yield (0-300%+ APY possible)
0%
Market-rate, borrower-dependent (~3-6%)
Variable, derived from perp markets (~8-25%+)
Yield Risk
Swap volume sensitive; no borrower/default risk
No yield = no risk
Counterparty + utilization rate risk
High dependency on CEX liquidity + perp rates
Capital Custody
Held in Genus vaults on-chain (non-custodial)
Centralized custodians (Circle + banks)
Custodied in Aave smart contracts
Held across smart contracts + CEX positions
Smart Contract Risk
Yes – bridge + vault logic risk
No (off-chain risk dominates)
Yes – protocol risk + liquidation engine
Yes – complex algorithmic + market-linked risks
Composability
High (via stgUSD)
Low – passive asset
Medium – must borrow to use actively
Medium – synthetic integrations, evolving support
DeFi Compatibility
Native via stusdGG wrapper
Limited (passive holding)
Better (via borrow)
Medium – synthetic integrations, evolving support
Exit Liquidity
Instant via protocol vaults (25% reserves)
Instant redemption via Circle partners
Must repay borrow to unlock
Liquidity dependent on AMMs + secondary markets
Redemption Mechanics
1:1 USDC redemption anytime
Centralized redemption (Circle only)
Must unwind lending position
Synthetic unwind logic, not guaranteed 1:1
Leverage Potential
Yes – stusdGG can be collateralized
No
Yes – via borrowing against USDC
Yes – yield strategies + structured trades
Transparency
On-chain vault balances + fee flows
Partial – reserves off-chain
On-chain, but abstracted by lending logic
Mixed – depends on CEX data + hedge visibility
Regulatory Risk
Moderate – depends on USDC solvency & DeFi
High – full reliance on U.S. banking system
Same as USDC
Medium – CEX exposure, less regulatory clarity
Market Dependency
Low – usage-driven (swap volume)
None
High – borrow demand fluctuates
Very high – funding rates + market structure
Token Type
Non-rebasing stablecoin (usdGG), with stgUSD as LST wrapper
Stablecoin
Interest-bearing LP token
Synthetic stablecoin
Composability Solution
stusdGG wrapper (1:1 claim on usdGG)
N/A
aUSDC tokens (protocol-specific)
Native integrations via synthetic infrastructure
Yield Claim Mechanism
Fee split paid continuously to usdGG, staked via stusdGG
N/A
Accrues over time, paid on exit
Funding captured through hedged perp strategies
Risk-Reward Tradeoff
Transparent, usage-driven yield with known base risk (USDC + protocol)
No yield, low volatility, centralized risk
Medium yield, borrower risk, smart contract risk
High yield, high complexity, funding/market risk
Use Case Fit
Treasuries, DAOs, LPs seeking real yield + liquidity
Passive holding, payments
Leveraged lending or farming
Speculative yield-seekers with high risk tolerance
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