> For the complete documentation index, see [llms.txt](https://docs.usx.capital/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.usx.capital/overview/susx-yield-bearing-usx.md). # sUSX: Yield-Bearing USX sUSX is the yield-bearing version of USX that represents your share in the protocol's yield-generating vault. While the number of sUSX tokens in your wallet remains constant, their value in terms of USX (and USD) increases over time as the protocol accumulates yield. No minimum stake required. You can start with any amount. {% hint style="info" %} **Yield Distribution Cycle** Yield accrues continuously and is distributed linearly to sUSX holders over a rolling 7-day window. The sUSX → USX exchange rate updates every 7 days to reflect accumulated yield. See [Yield Distribution Schedule](https://docs.usx.capital/protocol/yield-distribution-schedule) for full details. {% endhint %} ### How sUSX Works #### The Vault Mechanism When you stake USX, you receive sUSX, which represents your proportional share of the yield-bearing vault. The amount of sUSX you receive is determined by: * How much USX you deposit * The current exchange rate (USX:sUSX ratio) #### Token Exchange Example If you stake 1,000 USX when the exchange rate is 1 USX = 0.9 sUSX: * You receive: 900 sUSX tokens * Initial value: 900 × 1.11 USD = exactly 1,000 USD #### Value Appreciation Over Time The number of sUSX tokens you receive may be less than your USX deposit, but their USD value is equivalent at the time of staking. As the protocol generates yield, the USX value of each sUSX continuously increases. #### Example After one year at 10% APY: * Your 900 sUSX tokens (unchanged in quantity) are now worth **1,100 USX** * Unstaking yields: **1,100 USX = 1,100 USD** (assuming 1 USX = 1 USD) * Total gain: **100 USD or 10%** on your 1,000 USD deposit ### Earning Yield Automatically #### No Action Required Users simply hold sUSX to earn yield. No claiming, staking extensions, or position management needed. Yield accrues continuously and compounds automatically. #### How Yield Accrues * Protocol generates returns from onchain strategies (Aave, Morpho, Pendle, Euler, etc.) * 90% of generated yield is distributed to sUSX holders * 10% goes to protocol fees * Yield is reflected in increasing sUSX→USX exchange rate #### Auto-Compounding As yield accrues to the vault, the exchange rate increases. Your sUSX tokens automatically become more valuable in USD terms. No reinvestment needed. ### Staking and Unstaking #### Staking USX for sUSX * **Minimum:** No minimum amount (can stake $1 or $1M) * **Fee:** 0% (free to stake) * **Processing:** Instant * **Exchange Rate:** Determined by current vault rates You can stake USX anytime through the platform with a single transaction. #### Unstaking sUSX to USX When you unstake, your sUSX tokens are burned and you receive your proportional share of USX based on the current exchange rate. Unstaking is instant as there is no cooldown or waiting period. **Unstaking Process:** 1. Initiate withdrawal 2. Sign the transaction 3. Receive USX immediately in your wallet (with 0.05% unstaking fee adjusted) #### The 15-Day Cooldown Period The protocol requires a 15-day cooldown before processing withdrawals. This allows the protocol sufficient time to: * Systematically unwind positions in yield strategies * Gather liquidity for redemptions * Manage exit without market impact * Maintain strategy integrity Plan ahead if you need liquidity. The waiting period is built into the protocol design. ### Yield Generation Strategy #### Diversified Onchain Strategies The protocol generates yield from DeFi opportunities managed through [Blend](https://blend.money). Funds are deployed across audited vaults and apps: * **Pendle:** Yield-tranching protocols * **Euler:** Lending protocols * **Morpho:** Optimized lending markets * **Aave:** Major lending platform * And many more. You can always find which all apps are used here: . #### Delta-Neutral Hedging Strategies employ delta-neutral hedging to reduce volatility while maintaining yields. This conservative approach prioritizes sustainable returns over maximum yield. #### Risk Management The protocol maintains reserves to ensure sUSX value remains stable or increases. In scenarios where strategies underperform, the reserve fund absorbs losses rather than passing them on to sUSX holders. ### Composability and DeFi Integration #### Full DeFi Compatibility sUSX is designed to be fully composable with other DeFi protocols. You can use sUSX for: * **Lending:** Deposit sUSX into lending protocols for additional yield * **Liquidity Provision:** Supply sUSX to DEX pools for trading fees * **Collateral:** Use sUSX as collateral in borrowing protocols * **Yield Trading:** Tokenize and trade yield exposure #### Maximizing Yield Opportunities By stacking sUSX yields with other DeFi opportunities, you can compound returns. For example: * Earn up to 10% APY from sUSX appreciation (by staking) * Earn trading fees by providing liquidity ### Revenue Model and Sustainability #### How the Protocol Sustains Itself USX.Capital operates with a sustainable revenue structure: * **90% of generated yield** → Distributed to sUSX holders (who staked their USX) * **10% of yield** → Protocol fees (used for development, operations and reserves) #### Why This Works * Holders get the vast majority of yield * Protocol has an incentive to maximize returns (more yield = more fees) * Sustainable fee model doesn't rely on token incentives * Aligned economics benefit both protocol and users ### Reserve Fund Protection #### Insurance Against Drawdowns The protocol maintains an onchain reserve fund designed to cover potential losses from yield strategies. This protects both sUSX value and the broader protocol. #### How Reserves Help * Absorb losses before they impact sUSX holders * Maintain stable or increasing sUSX value * Provide a buffer during market volatility * Enable strategic withdrawals during underperformance *** ### Common Questions **Q: Is there a minimum to stake?** A: No. You can stake any amount, from a small test transaction to $1M+. **Q: Can I withdraw anytime?** A: Yes. Unstaking is instant and you receive USX in your wallet immediately with no cooldown. **Q: What exchange rate do I get?** A: The current exchange rate at the time of staking/unstaking, determined by accumulated yield. **Q: Do I have to claim rewards?** A: No. Yield is automatically compounded. Just hold sUSX and your USD value increases. **Q: What if strategies underperform?** A: The reserve fund absorbs losses, protecting sUSX holders from drawdowns. **Q: Can I use sUSX in other protocols?** A: Yes, sUSX is fully composable. You can use it for lending, liquidity provision, or as collateral elsewhere. **Q: Why is the cooldown 15 days?** A: It allows the protocol time to unwind positions in yield strategies and gather liquidity for redemptions without market impact. **Q: Is my principal protected?** A: sUSX is backed by diversified, hedged strategies. The reserve fund provides additional protection against underperformance. --- # Agent Instructions This documentation is published with GitBook. GitBook is the documentation platform designed so that both humans and AI agents can read, navigate, and reason over technical content effectively. Learn more at gitbook.com. ## Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. 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