What USX does
USX is a decentralised, USD-pegged stablecoin issued by dForce, a multi-chain DeFi protocol that also runs lending markets and a stablecoin swap platform. Unlike centralised stablecoins such as USDT or USDC, USX is minted by users depositing overcollateralised crypto assets — a design closer to Dai's original model than to a fiat-backed token sitting in a bank account.
The protocol allows users to mint USX against approved collateral types, with the system maintaining a collateralisation ratio above 100% to absorb price swings in the underlying assets. dForce also operates USDx-style stablecoin pools that let users swap between multiple dollar-pegged tokens with low slippage, and USX circulates across several chains including Ethereum, Arbitrum, Optimism and BNB Chain.
Risks worth knowing
dForce has a rougher security history than most of its stablecoin peers. Its lending protocol was drained in a 2020 exploit that briefly became one of the largest DeFi hacks at the time (funds were later returned), and the broader dForce ecosystem has weathered additional bridge and contract incidents since. USX itself is small relative to the giants of the sector, which means thinner liquidity, wider spreads on decentralised exchanges, and a higher chance of temporary depegs during stressed markets.
As with any overcollateralised stablecoin, USX's peg depends on the market value and liquidity of its backing collateral holding up, and on dForce's governance and risk parameters being managed conservatively as new collateral types are added. Holding USX means taking on smart contract risk, collateral risk and the operational track record of a team that has had security incidents before — worth weighing against the yield or utility on offer.