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The Efficiency Strategy for Money Markets

United States Dollar Coin Plus (USDC+) is an optimally efficient version of the USDC stablecoin provided by Circle (CRCL) a publicly traded US company. It produces efficiency and interest-rates through a lender/borrower based strategy.

Reflect Money is a Member of the Circle Alliance - a program by Circle to combine the best operators who wish to scale the use of its digital cash.


Please be aware that Reflect Money and its USDC+ stablecoin are not affiliated with or endorsed by Circle Inc and are entirely seperate entities.

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Operational Strategy

Here you will find a description of the financial intermediation strategy utilised by onchain programs in order to maximise the interest-rate of its USDC collateral.

The Capital Supplier Methodology

The Capital Supplier strategy is one of the simplest and safest interest-rate generating strategies available on public ledger networks as it utilises highly-liquid cash assets to farm interest-rates on overcollateralised lending/margin pools.

1

USDC is Deposited.

USDC is sent by users or developers to the distributor program, which acts as a non-custodial pool for all collateral assets.

2

Distributor Calculates Rates

The distributor program calcultes the best interest-rates at X size for USDC on the network and marks what venues can host up to how much liquidity.

3

USDC is Distributed

The program then distributes this USDC immediately in order to capture interest-rates from leverage markets or borrow/lend pools.

4

USDC+ is Issued

Depositors receive USDC+ equivalent to their share in the pool i.e. 1 USDC can equal 0.975 USDC+ similar to liquid staked tokens.

5

USDC+ collateral grows

The value of USDC+ in USDC grows and appreciation in this can be claimed by unwrapping the USDC+ token to its native form.

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Strategic Value Propositions

USDC+ is designed to provide a familiar, safe and low risk-tolerance yield-bearing asset for use within financial applications requiring interest-rates on its stablecoin balances. More information about its primary value propositons can be found below.

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Reduction in Margin Costs

By providing USDC to all prominent lending venues Reflect is lowering the cost of margin for cash which encourages more volume.

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Prevent Impermanent Loss

By adding a native interest rate to SVMs largest liquidity pair token you can reduce impermanent loss faced on one side of the pool.

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Increase in Available Margin

Reflect provides cash-capital to money markets over a longer time-horizon and therefore increases the available size of lending for these markets.

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Earn During Settlement

USDC is a payments-powerhouse but lacks the ability to be intermediated during payment-settlement periods. USDC+ enables low-risk value capture on this period.

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Risk Modeling Cross-Margin Strategies

Integrators should understand the composite risk profile when deploying USDC+ within their applications, as the strategy inherits risks from all underlying lending venues.

Primary Risk Considerations

Since USDC+ distributes capital across multiple borrow/lend markets, the risk profile combines individual protocol exposures with cross-margin strategy considerations:

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Protocol Security Risk

Each lending venue carries distinct smart contract risks, audit histories, and security track records that compound across the strategy.

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Liquidity & LTV Variance

Different protocols maintain varying Loan-to-Value ratios and withdrawal capacities that may affect liquidity during market stress.

Key Risk Factors for Integration:

  • Multi-venue exposure: Smart contract risks compound across all active lending protocols
  • Liquidity constraints: Withdrawal capacity dependent on utilization rates across venues
  • Yield volatility: Interest rates fluctuate based on market conditions and cross-venue competition
  • Venue concentration: Capital allocation methodology may create dependencies on specific protocols

Integrators should treat USDC+ as a higher-risk asset compared to native USDC and implement appropriate user disclosures regarding multi-venue exposure and inherited protocol risks.