[IDEA] Add Support USD1 on Venus

[bh1]

Rationale

USD1 is a stablecoin issued by World Liberty Financial being onboarded to the BNB Chain Ecosystem and getting actively supported.

World Liberty Financial, the issuer, is a venture launched by the Trump Family, and listing USD1 is broadly aligned with Venus’ goals of boosting adoption in markets where growth potential is currently high.

Summary

• In an environment where stablecoins now have over $250 billion in circulation, fiat-backed tokens like USD1 offer a layer of stability.

• Strategic Opportunity: Listing USD1 provides our lending protocol with an asset that:

  • Diversifies collateral pools
  • Attracts institutional liquidity
  • Reinforces confidence with a token whose backing is anchored in low-risk assets.

Key Discussion Points

1. Chaos Labs recommendations should support immediate Supply without collateralization while liquidity is onboarded

2. Even though it’s relatively new this will be a high profile asset and perhaps Venus Community should consider it in the core pool

[Omar.bnb]

The next 9 figures asset on Venus core pool.

+1 to the proposal

[DomVSPM]

A perfect opportunity to build a long-term relationship with the WLF.

[C0sty]

Bring it!!! Hope Trump sees it😂

[mehmeterkcn]

Looks like a good! Supporting USD1 aligns perfectly with Venus’ vision and brings strong potential… Growth, stability, and broader adoption.

[Tomm]

Haha hopes to increase TRUMP’s investment and attention to Venus protocol! support this proposal

[ChristoWarriorCrypto]

This sounds very promising! USD1 could give a strong boost to adoption and bring new liquidity to the protocol. I love seeing how Venus keeps innovating and exploring new opportunities.

[Obacoin]

This is good, this is what venus does; listing high value, high potential assets for staking and borrowing. Make usd1 liquid and more valuable!

[Gregor]

We need it to get inside the US market. After the cancelation the broken law about DeFi there is a big chance for us to play a really big role there. No doubt we have to do it.

[mopgawka]

I like the idea of adding an asset from WLF. it seems like a gamble and we can get additional liquidity, I’m all for it

[Debbie]

Really excited about this! USD1 has huge potential, and bringing it to Venus could open new doors. Backing the initial supply sounds like a solid first step—can’t wait to see where this goes!

[FREDY]

Hi

At first glance it looks an interesting idea, but in the other hand I think that decisions about adding a new asset should be based on more information rather than just the name of the institution behind it. Above all there are resources to be spend by the Venus to have it onboard that could eventually be better spent on more mature tokens, with liquidity and incentives.

I tried to find out its contract on BSC to see its existing circulation supply and market cap and couldn’t find it.
If someone from WLF could input some information, plans and numbers, custody and how reserves will be held that could help in moving this ahead.

That helps making a more informed and long term decision.

[chaoslabs]

Overview

Chaos Labs supports the listing of USD1 within Venus’s BNB Core pool. Below is our analysis and recommendations for initial risk parameters.

USD1

USD1 is a U.S. dollar–backed stablecoin launched by World Liberty Financial Inc., with custody and infrastructure support provided by BitGo. Designed to maintain a 1:1 peg with the U.S. dollar, USD1 is fully backed by short-term U.S. government treasuries, U.S. dollar deposits, and other cash equivalents.

USD1 is currently deployed on both the Ethereum and Binance Smart Chain (BNB Chain) networks, with plans for expansion to other blockchains. To mint USD1, users must sign up for a BitGo account and, upon approval, initiate a mint request by sending U.S. dollars to the issuer’s bank. Upon receipt, USD1 tokens are issued directly to the user’s BitGo wallet. Redemption follows a similar process in reverse, allowing users to convert USD1 back to fiat currency.

USD1’s reserves are subject to regular audits by independent third-party accounting firms (there are no readily available details on these audits at this time) to ensure transparency and maintain the 1:1 backing.

It is important to note that, as of now, USD1 is not yet tradable on centralized exchanges.

Market Cap & Liquidity

USD1’s market cap on BNB Chain has increased rapidly in recent weeks, reaching over 110M; it has a market cap of just 14M on Ethereum as of this writing.

Its liquidity has been very stable since launch, at least $6M combined in BNB and USDT liquidity paired against it.

This amount of liquidity is sufficient to support the asset’s listing on Venus at this time.

Additionally, it has demonstrated relatively strong peg stability in its short amount of time trading. However, this is not enough price data from which to draw strong conclusions regarding its stability.

Collateral Factor

As suggested in the proposal, given the nascent nature of the asset, as well as historically low demand for using stablecoins as collateral, we recommend listing the asset with a CF of 0%. This has the further benefit of ensuring that users do not loop the asset with itself, taking up valuable borrowable liquidity. As this market develops and more public information becomes available, we may recommend increasing the asset’s CF.

Supply and Borrow Caps

We recommend setting the supply cap at 2x the liquidity available under the Liquidation Penalty. This leads to a recommendation of 16M, with a borrow cap set to 90% of this value.

Oracle Configuration/Pricing

There do not appear to be any price feeds available from Venus-trusted oracle providers at this time. However, until this is available, it is acceptable to use a value of 1 as a placeholder given that the asset cannot be used as collateral.

Specification

Parameter	Value
Asset	USD1
Chain	BNB Chain
Pool	Core
Collateral Factor	0%
Liquidation Penalty	10.00%
Supply Cap	16,000,000
Borrow Cap	14,400,000
Kink	80%
Base	0.0
Multiplier	0.10
Jump Multiplier	2.5
Reserve Factor	25%

Disclaimer

Chaos Labs has not been compensated by any third party for publishing this recommendation.

[Frayst]

Perfect timing to add it in Venus !

[Omar.bnb]

could you briefly explain to me why do we set reserve factor at 25% for every newly listed asset on Venus?

Shouldn’t we set it at 10% until we attract significant liquidity? would we be taking any additional risk if we do that?

[chaoslabs]

Hi Omar, we don’t set the Reserve Factor to 25% by default for each newly listed asset. Instead, we evaluate each asset individually based on its specific characteristics and risk profile.
In general, a higher RF at listing is recommended to build a safety buffer tailored to the asset’s nature, helping to mitigate the potential accrual of bad debt over time. This is particularly important given how the Reserve Factor in Venus accrues as supplied assets within the pool, which helps maintain liquidity for user exits in the event of bad debt.
For USD1, the asset is still relatively new with limited public information available. Given this higher risk profile, especially when compared to more established assets like USDC and USDT, we’ve recommended setting the RF to 25%.