What is dTRINITY?
dTRINITY (short for "DeFi Trinity") is the world's first subsidized stablecoin protocol, a new DeFi primitive designed to stimulate onchain credit markets. The protocol consists of three core components: (decentralized stablecoin), (lending protocol), and (liquidity pools).
dTRINITY offers float revenue-funded interest rebates to borrowers of its native stablecoin, dUSD, thereby reducing their effective borrowing rates. Unlike traditional stablecoin models that reward passive holders, stakers, or lenders on the supply side, dTRINITY flips the script by actively subsidizing dUSD borrowers on the demand side. This, in turn, unlocks structurally lower costs for borrowers as well as higher yields for lenders and liquidity providers (LPs) through greater credit demand and money velocity.
What are the risks involved?
dTRINITY is an experimental DeFi protocol that carries significant risks, including but not limited to market risk, smart contract risk, counterparty risk, and security vulnerabilities, any of which may result in the complete loss of user funds. All DeFi protocols and digital assets carry inherent risks, including the potential for loss of funds. The use of AI tools in software development and the increasing sophistication of AI-enabled attacks may further compound these risks.
The content made available through dTRINITY's user interfaces, websites, documentation, blogs, and social media channels, including Telegram, Discord, and X, is provided for informational purposes only and does not constitute financial, legal, tax, or other professional advice. Past performance is not indicative of future results.
Users should conduct their own research and due diligence before interacting with dTRINITY and any DeFi protocol or digital asset. For more information, please refer to the full .
dTRINITY, its developers, contributors, affiliates, and service providers disclaim any liability for losses or damages arising from or related to the use of its interfaces, smart contracts, or associated services.
Who are dTRINITY’s target users?
dTRINITY is designed primarily for advanced DeFi users, including experienced lenders, borrowers, LPs, traders, and other sophisticated onchain market participants who understand the risks associated with digital assets, smart contracts, leverage, and decentralized financial systems. The protocol involves complex mechanisms which may not be suitable for retail or inexperienced users. Users should conduct their own research and carefully evaluate all associated risks before interacting with the protocol.
What is dUSD?
dUSD is a decentralized reserve-backed stablecoin (RBS) that is soft-pegged to the US dollar. It is backed 1:1 by chain-isolated reserves consisting of other dollar-denominated stablecoins (e.g., USDC, USDT, USDS, frxUSD), yieldcoins (e.g., sUSDS, sfrxUSD), and Curve LP positions (e.g., dUSD/sfrxUSD, dUSD/sUSDS).
How do I acquire dUSD?
- Minting: Users can mint dUSD atomically and permissionlessly with dTRINITY on a 1:1 basis using whitelisted reserve assets. The minting rate is determined by price oracle feeds for the selected reserve asset (e.g., 1 dUSD = $1 of frxUSD or sfrxUSD). There are no fees for minting dUSD.
- Buying: Users can buy dUSD permissionlessly from the secondary market through Curve and other integrated exchanges. The exchange rate is determined by available liquidity. Secondary market swaps may also incur slippage and trading fees.
- Borrowing: Users can borrow dUSD permissionlessly from dLEND and other integrated lending protocols. Borrowing dUSD often involves supplying collateral to secure the loan. The amount of dUSD that can be borrowed is determined by available credit supply, collateral value, and lending market parameters, e.g., Max LTV (Loan to Value) and borrowing caps. Users must repay their loans in order to withdraw collateral from lending markets. dUSD loans also incur interest rates, which may be offset by interest rebates from dTRINITY.
How do I redeem or sell dUSD?
- Redeeming: Users can redeem dUSD atomically and permissionlessly with dTRINITY on a 1:1 basis for underlying reserve assets based on available liquidity (excluding Curve LP positions). The redemption rate is determined by price oracle feeds for the selected reserve asset (e.g., 1 dUSD = $1 of frxUSD or sfrxUSD). Redeeming dUSD may incur up to 0.5% in fees.
- Selling: Users can sell dUSD permissionlessly on the secondary market through Curve and other integrated exchanges. The exchange rate is determined by available liquidity. Secondary market swaps may also incur slippage and trading fees.
How does dUSD maintain price stability?
dUSD’s price stability is maintained through its hard peg and soft peg to the US dollar.
- Hard Peg Mechanism: Users can mint/redeem dUSD directly with dTRINITY on a 1:1 basis with/for reserve assets (excluding Curve LP positions). The minting/redemption rate is determined by price oracle feeds for the selected reserve asset (e.g., 1 dUSD = $1 of frxUSD or sfrxUSD), minus fees.
- Soft Peg Mechanism: The hard peg allows market makers and arbitrageurs to soft peg dUSD on secondary markets by exploiting price differences between dUSD and its par value. However, redemption fees, liquidity conditions, and market volatility may cause dUSD to trade at discounts or premiums relative to its par value. When dUSD trades below $1, users can buy discounted dUSD and redeem it at parity, minus fees. When dUSD trades above $1, users can mint new dUSD at parity and sell it into the market. These arbitrage mechanisms help stabilize dUSD’s market price around $1 over time.
- Open Market Operations: If there is low arbitrage activity, dTRINITY may conduct open market operations to support the soft peg and capture arbitrage opportunities directly. When dUSD trades below $1, the protocol may buy back dUSD using available reserve assets through Stability Market Operations (SMOs). When dUSD trades above $1, the protocol may mint and sell or deploy new dUSD to acquire additional reserve assets through Algorithmic Market Operations (AMOs).
What is sdUSD?
sdUSD (Staked dUSD) is the dollar-denominated receipt token for staking dUSD into dSTAKE, an ERC-4626 vault that deposits into dLEND. The vault earns yield and rewards from secured lending, allowing the underlying value of sdUSD to appreciate over time. Therefore, sdUSD is backed by over-collateralized dUSD loans and should be considered a “yieldcoin,” not a stablecoin.How do I acquire sdUSD?
- Staking: Users can stake dUSD atomically and permissionlessly into dSTAKE to receive sdUSD, which represents a yield-bearing claim on dUSD deposits in dLEND. The sdUSD/dUSD exchange rate increases over time as the vault accrues lending yield. Staking capacity is determined by the supply cap of dUSD in dLEND. There are no fees for staking dUSD.
- Buying: Users can buy sdUSD permissionlessly from the secondary market through Curve and other integrated exchanges. The exchange rate is determined by available liquidity. Secondary market swaps may also incur slippage and trading fees.
How do I unstake or sell sdUSD?
- Unstaking: Users can unstake (redeem) dUSD atomically and permissionlessly from dSTAKE by depositing sdUSD. Unstaking capacity is determined by the available liquidity of dUSD in dLEND. Unstaking dUSD may incur up to 0.1% in fees, which are retained by the vault for all remaining sdUSD holders.
- Selling: Users can sell sdUSD permissionlessly on the secondary market through Curve and other integrated exchanges. The exchange rate is determined by available liquidity. Secondary market swaps may also incur slippage and trading fees.
How does sdUSD maintain price stability?
sdUSD is dollar-denominated but it is not pegged to the US dollar. Rather, its value is derived from the dSTAKE vault’s NAV (Net Asset Value). Similar to dUSD, sdUSD’s price stability is maintained through its hard peg and soft peg to the vault’s NAV.
- Hard Peg Mechanism: Users can stake/redeem dUSD directly with dSTAKE based on the vault’s NAV exchange rate. The sdUSD/dUSD exchange rate is determined by the total underlying dLEND dUSD deposits plus accrued yield and rewards held by the vault, minus fees. As yield accrues over time, the NAV and redemption value of sdUSD increase accordingly.
- Soft Peg Mechanism: The hard peg allows market makers and arbitrageurs to soft peg sdUSD on secondary markets by exploiting price differences between sdUSD and its underlying NAV. However, unstaking fees, liquidity conditions, and market volatility may cause sdUSD to trade at discounts or premiums relative to its NAV. When sdUSD trades below its NAV, users can buy discounted sdUSD and redeem it through dSTAKE based on the prevailing exchange rate, minus fees. When sdUSD trades above its NAV, users can stake dUSD into dSTAKE to mint new sdUSD at the prevailing exchange rate and sell it into the market. These arbitrage mechanisms help stabilize sdUSD’s market price around its NAV over time.
How do dUSD subsidies work?
Subsidies are funded exogenously by dUSD’s reserve yield (float revenue) and distributed to its borrowers as interest rebates. Rebates accrue constantly for dUSD borrowers with active debt across supported lending markets. dTRINITY mints new stablecoins periodically using at least 90% of float revenue during that period to subsidize dUSD borrowers on integrated lending protocols. However, rebates must be claimed separately; they are not auto-applied toward debt repayment. Borrowers still incur a Gross Borrow APY on active debt.
Why subsidize borrowers?
Subsidizing dUSD borrowers reduces their Net Borrow APY, leading to more credit demand and utilization. This, in turn, raises the Supply APY for lenders, creating a win-win dynamic for both sides of the market. dUSD LPs also benefit from greater trading volume and fee earnings thanks to subsidy-driven money velocity.
How do subsidies increase lending yields?
In classic economics, borrower subsidies shift the demand curve upward on a supply-demand chart, where the y-axis represents interest rates and the x-axis represents credit. This upward shift means more subsidized borrowers are willing to borrow even at higher gross interest rates, increasing credit utilization and debt expansion. As utilization rises, a new supply-demand equilibrium is formed at a higher level of credit activity. This results in higher yields for lenders, driven not by direct subsidies to the supply side, but by stronger borrowing demand and greater economic activity.
How do subsidies enhance yield looping strategies?
Yield looping (carry trading) involves borrowing stablecoins against yieldcoin collateral of the same denomination to acquire more yieldcoins and repeatedly supplying them as collateral in order to amplify yield exposure and leverage while capturing the interest rate spread between borrowing costs and underlying collateral yields. dUSD may enhance these strategies through subsidized borrowing costs, potentially improving net carry and reducing the effective cost of leverage. This may allow loopers to improve capital efficiency and earn potentially higher risk-adjusted yields compared to using unsubsidized loans. However, looping strategies carry significant risks, including but not limited to liquidation risk, liquidity risk, interest rate risk, and the potential loss of funds. For more information, please refer to the full .
Why don’t banks subsidize traditional loans?
Traditional banks are less likely to subsidize borrowers due to several structural reasons:
- Regulated financial institutions are costly to operate and generally retain lower net interest margins compared to DeFi protocols at scale.
- Real-world assets used as collateral to secure loans (e.g., real estate) can be slower and costlier to liquidate, posing greater credit risk to traditional lenders. Subsidizing borrowers, therefore, could increase not only borrowing demand but also credit risk for banks. In DeFi, most loans are over-collateralized by liquid assets, enabling faster liquidation and lower credit risk.
- Traditional fiat banking systems already benefit from endogenous credit creation and structurally lower borrowing costs accommodated by central bank monetary policies. As a result, commercial banks can stimulate borrowing demand systemically without needing explicit borrower subsidies like those used in exogenous RBS systems such as dTRINITY.
Why don’t other stablecoin and DeFi projects subsidize borrowers?
Most stablecoin and DeFi projects follow a supply-centric model that rewards holders, stakers, depositors, and liquidity providers while borrowers pay full interest. This mirrors traditional finance, where capital allocation is generally optimized for lenders rather than borrowers. Borrower subsidies are relatively uncommon for several structural and economic reasons:
- Subsidizing borrowers is often viewed as unconventional because it challenges deeply ingrained financial and economic mental models around how credit markets should function.
- Many projects lack sustainable sources of exogenous yield or float revenue needed to fund borrower subsidies at scale.
- Many stablecoin issuers rely on float revenue as their primary source of monetization, creating little incentive to redirect that revenue back to borrowers through subsidies.
Where is dTRINITY deployed?
dTRINITY is currently live on Ethereum, Fraxtal, and Katana. Support for additional networks may be added over time based on ecosystem growth, liquidity conditions, infrastructure readiness, and governance decisions, among other factors. For more information, please refer to .
How do I transfer dUSD and sdUSD between supported networks?
dUSD and sdUSD share common names and symbols across supported networks, but they are not directly fungible across chains and cannot be natively bridged due to dTRINITY’s chain-isolated infrastructure. Instead, users can swap dUSD or sdUSD into a commonly supported intermediary asset on one network (e.g., frxUSD on Ethereum), bridge that asset to another supported network, and then swap it back into the native dUSD or sdUSD on the destination chain (e.g., Fraxtal dUSD). Doing so, however, may incur bridging fees, trading fees, and slippage.
Why does dTRINITY have chain-isolated infrastructure?
dTRINITY uses chain-isolated infrastructure to contain chain-specific risks and reduce the potential for cross-chain contagion, sacrificing native cross-chain fungibility in exchange for stronger risk isolation and protocol integrity. As a result, the backing of dUSD and sdUSD are segregated by network, meaning each deployment maintains its own independent reserve, collateral, and liquidity system to support the circulating supply on that chain. This architecture helps prevent issues on one network, such as exploits, bridge failures, liquidity crises, or insolvencies, from directly impacting deployments on other networks. Consequently, dUSD and sdUSD are intentionally designed to be non-fungible across chains.
Where can users access dTRINITY?
dTRINITY is not available to users from Belarus, Canada, Cuba, Haiti, Iran, Myanmar (Burma), North Korea, Russia (including Crimea, Donetsk, and Luhansk regions), Singapore, Somalia, South Sudan, Syria, the United Kingdom, the United States, Venezuela, or any other jurisdiction or region designated by dTRINITY from time to time as restricted. For more information, please refer to .
What is the dT Points Program?
The program incentivizes lenders and LPs to supply capital into designated markets prior to the TGE, enabling early ecosytem liquidity, credit expansion, and TVL growth. Points can be claimed for , dTRINITY’s future governance token, after the TGE.
When will community governance be implemented?
dTRINITY plans to transition toward community governance post-TGE, allowing governance token holders to participate in protocol decision-making through a vote-locking mechanism (i.e., veTokenomics). Governance may include decisions related to dUSD subsidies, TRIN emissions, incentives, reserve and collateral management, liquidity strategies, protocol parameters, and other ecosystem initiatives.
When is the TGE?
The TGE (token generation event) for dTRINITY’s governance token is currently planned for the end of 2026.
When did dTRINITY launch?
Development on dTRINITY started in early 2024. The protocol officially debuted on Fraxtal as its genesis network on December 18, 2024.
Who are dTRINITY target partners?
- Lending Protocols: dTRINITY may integrate dUSD as a medium of credit and sdUSD as collateral with external lending protocols, unlocking new liquidity, utility, and distribution channels for these assets.
- Decentralized Exchanges (DEXs): dTRINITY may deepen onchain liquidity and improve trading efficiency for dUSD and sdUSD through incentivized liquidity pools.
- Interest Rate Marketplaces: dTRINITY may tokenize sdUSD into fixed-rate and variable-rate derivatives, enabling interest rate trading and advanced yield strategies.
- Other Stablecoins & Yieldcoins: dTRINITY may collaborate with other stablecoin and yieldcoin projects to enhance cross-protocol liquidity, float revenue, collateral support, composability, and capital efficiency for dUSD, sdUSD, and dLEND.
- Yield Aggregators: dTRINITY may integrate with automated vaults and yield optimization protocols to improve accessibility, distribution, and yield generation for users.
- Vault Curators: dTRINITY may collaborate with vault curators to support risk-managed, isolated lending strategies for dUSD and sdUSD across integrated partner protocols.
- Vote Marketplaces: dTRINITY may integrate with governance vote marketplaces post-TGE to optimize protocol emissions and subsidy allocation across integrated markets.
- Oracle Providers: dTRINITY may integrate with oracle providers to support reliable pricing, data feeds, and risk management infrastructure for protocol-issued assets, reserve assets, and collateral assets across internal and external ecosystems.
- Plus more TBD! For more information, please refer to .
Who are dTRINITY’s security auditors?
dTRINITY has completed multiple third-party smart contract audits with leading Web3 security firms, including Halborn, Hashlock, Hats Finance, Verichains, and Cyberscope. For more information, please refer to .
Who are dTRINITY’s contributors?
The project’s core contributors are stablecoin industry veterans since 2018, with team members including the Co-founders of Stably.
Who are dTRINITY’s backers?
dTRINITY is backed and advised by the founders of Sky, Frax Finance, Convex Finance, and Coin98.