External and operational risks

Liquidity Risk

USX has 1:1 redemption with USDC, and a portion of backing assets are deployed in TradFi strategies.

During high redemption demand, the protocol may be unable to meet instant redemption requests if liquid reserves are insufficient. TradFi positions take a maximum of 14 days to unwind.

Mitigation Measures:

• Liquidity buffers: Maintain a portion of TVL in liquid USDC for immediate redemptions (coming soon).

• Dual redemption model: 14 day standard redemptions (no fees) or instant secondary market swaps with fees.

Stablecoin Depeg Risk

USX is backed exclusively by USDC. If USDC loses its dollar peg due to Circle's operational issues, regulatory actions, or banking stress, USX's own peg and redemption value are directly compromised.

Mitigation Measures:

• Real-time USDC price monitoring with alerts.

• Emergency liquidity reserves maintained in USDC for redemptions during black swan events.

• Halt minting USX tokens during significant USDC depeg events.

For our full risk disclosure statement, please refer to important legal disclosures and risk disclaimers.