The memo
REJECTED, and it belongs in client education because the failure mode is one no amount of smart-contract auditing would have caught. On 2025-01-10 Usual UNILATERALLY changed the redemption terms of USD0++. Holders had been able to redeem 1:1 for USD0; the protocol introduced a floor price of $0.87 instead. The token promptly traded to ~$0.90. There was no exploit, no oracle failure, and no bad debt in the underlying — the issuer simply rewrote the terms of the instrument by decree. The damage came through composability: $200M+ of borrows on Morpho used USD0++ as collateral, and the repricing pushed many above the 86% LLTV into liquidation. Curve pools were left badly imbalanced. Holders who never touched leverage were harmed by the liquidation cascade around them. The lesson to carry: a redeemable token is only worth its redemption TERMS, and those terms are a governance variable unless they are immutable. This is why Liquity-style immutability is graded highest in assets.ts — not ideology, but because nobody can vote to change what you are owed.
What would reopen the file
- n/a — rejected
Facts on file
- Verdict
- Rejected
- Exposure
- stable lending
- Chains examined
- Ethereum
- Memo version
- v1
- Reviewed
- Next review