Frequently Asked Questions


1. What is Chi Protocol? Chi Protocol is a scalable and decentralized protocol dedicated to bringing stability to the cryptocurrency economy, allowing users to mint USC, a stablecoin with embedded yield using LSTs as reserve assets.

2. What is the motivation behind Chi Protocol? Chi Protocol aims to scale DeFi by providing a secure, capital efficient, and fully decentralized with intrinsic yield stablecoin that is not under any government's authority while benefiting CHI and USC holders of all sizes.

3. What are USC and CHI? USC is a 100% collateralized stablecoin pegged to the US dollar, using LSTs as reserve assets to maintain safety and decentralization. USC can be staked to receive various sources of yield, including more USC, ETH and CHI.

CHI is the native token of the Chi Protocol which earns the interest of the LSTs in the reserves. Chi Protocol is managed by people worldwide who lock CHI.

4. How can USC stability be ensured? USC stability is maintained through a Dual Stability Mechanism, which provides arbitrage opportunities in all de-peg scenarios. These factors work together to ensure that the value of USC remains close to its 1 USD peg, while the value of the stablecoin in circulation is fully backed by LSTs.

5. What are the key benefits of using Chi Protocol?

  • USC can be staked to earn high yield paid in USC, stCHI and stETH

  • CHI stakers are entitled to receive LST yield, possibly yielding an higher APR than ETH

  • Earn boosted trading fees on USC/ETH and CHI/ETH LP positions

6. How can I earn money using Chi Protocol?

There are four different ways to generate revenue using Chi Protocol:

  • Stake CHI to earn LST yield .

  • Stake USC to earn more USC, stCHI and stETH.

  • Lock CHI to earn LST yield, Chi Protocol’s revenue and CHI incentives.

  • Stake USC/ETH and CHI/ETH LP to earn stCHI and stETH

  • Provide USC/ETH and CHI/ETH LP positions to buy discounted CHI and earn boosted trading fees with DSO.

7. stETH the only reserve asset accepted by Chi Protocol? Yes, stETH is the only reserve token accepted by Chi Protocol at genesis. Governance may propose additional tokens to diversify across LSTs.

8. How can I mint USC with Chi Protocol? USC can always be minted from the protocol with stETH or ETH at a 100% collateral ratio. For each USD worth of stETH/ ETH deposited, users will receive 1 USC

9. How can I receive ETH back with USC? Users can always echange their USC for ETH using DEX liquidity and POL. Direct redemptions with ETH are performed by arbitrage once USC’s price is below 1 USD and Chi Protocol has excess reserves.

10. What are USC Rewards? USC rewards arises from the arbitrage contract redeeming USC (not burn) when below peg and the protocol has excess reserves. The redeemed USC is then distributed to USC stakers.

11. I'm a holder of USDC, FRAX, and/or other stablecoins; how can I get stable interest with Chi Protocol? It's easy! Convert your held assets to USC through any DEX. As long as you buy and stake USC, you will earn more USC, stCHI and stETH paid by Chi Protocol.

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