Author: Biteye
Currently, the rapid development of AI has created enormous demand for computing resources and related infrastructure. However, traditional financing models have many drawbacks: they are slow, opaque, geographically restricted, and lack scalability.
USD.AI targets financing pain points in AI hardware and DePIN. Projects like GPU computing clusters and new IoT networks often have massive capital expenditures but struggle to obtain loans from traditional banks (even with stable cash flows). Meanwhile, a large amount of DeFi funds lack reliable high-yield destinations.
USD.AI connects these two: through protocol pools, users lend stablecoins to strictly selected AI infrastructure operators, using their expensive hardware as collateral. This way, these operators obtain urgently needed expansion funds to purchase more equipment and expand computing capacity, while crypto users earn high lending interest returns, creating a win-win scenario.
⭐️ I. Core Mechanism
USD.AI adopts a dual-token model, issuing two stablecoin assets: USDai and sUSDai, allowing users to deposit stablecoins and mint USDai; staking USDai enables users to obtain sUSDai.
- USDai is a low-risk synthetic dollar, backed by interest-bearing government bonds (like the "M" token of M^0), but the underlying government bond yields are not distributed to USDai holders. It provides stability and liquidity and can be redeemed at any time.
- sUSDai is an "earnings version" token for investors, with funds directed towards loans for AI computing power, energy, communication, and other infrastructure. sUSDai's revenue comes from two sources: first, the yields from USDai's underlying government bonds, and second, interest from loans to AI hardware and DePIN physical infrastructure assets.
Note that sUSDai has a 30-day redemption window. If users don't want to wait 30 days and want priority redemption rights, they can participate in the QEV auction mechanism.
In essence, USD.AI aims to transform originally illiquid AI hardware, computing devices, and DePIN assets into efficient, liquid productive capital through its dual-token USDai/sUSDai system.
⭐️ II. Technical Interpretation
In its technical mechanism design, USD.AI introduces the CALIBER asset framework and QEV redemption mechanism to provide a safety net and liquidity guarantee for the aforementioned model.
The CALIBER framework is a solution for digitizing and legally custodying physical assets. When borrowers use AI hardware as collateral, USD.AI mints an NFT ownership certificate on-chain. If borrowers default, the protocol can legally recover and dispose of the equipment to repay investors. From the user's perspective, CALIBER means the assets behind sUSDai are real, guaranteed hardware, enhancing the system's credibility.
The QEV mechanism manages sUSDai redemption liquidity. Unlike typical stablecoins' first-come, first-served queue, USD.AI designs redemption as a monthly blind auction. The protocol packages available redemption funds and allows exiting holders to anonymously bid. Those with higher bids (willing to forfeit less interest) get priority conversion, essentially using market methods to determine who exits first. This auction mechanism prevents redemption panic and incentivizes long-term holding.
⭐️ III. Participation Method
Currently, USD.AI is in the closed beta stage, with participants able to mint USDai and sUSDai on Arbitrum. As it's still a closed test, the official has not yet opened a public application interface, so users need to fill out a whitelist on the official website to qualify for participation.
According to the roadmap, the project plans to soon open public testing, launch on the Ethereum mainnet, Berachain, and other chains, and introduce a points reward mechanism called Cores: early beta testers and contributors will receive points based on activities for future rewards.
⭐️ IV. Risk Warning:
Liquidity Lag Risk: Since sUSDai uses a closed-cycle redemption design, redemption normally requires waiting for a cycle (about 30 days) to extract underlying assets. If concentrated redemption demands occur in a short time, users' fund liquidity will be limited. The project introduces a QEV auction mechanism to buffer this, but secondary market liquidity might still experience temporary insufficiency in extreme situations, requiring some liquidity expectation management.
Early Protocol Risk: USD.AI is still in early testing, and its smart contracts and auction mechanisms might have undiscovered issues that need time to be verified. Before participating, users should be psychologically prepared and assess potential extreme scenarios.
⭐️ V. Future Outlook
As artificial intelligence infrastructure demand experiences explosive growth, if USD.AI's model operates well, it not only means DeFi funds can massively flow into supporting AI network construction but also suggests USD.AI might become an indispensable part of the AI infrastructure era.
