NEAR, the native token of the Near Protocol, rose today after the Near Protocol blockchain launched its long-awaited stablecoin, USN.
At the time of writing, NEAR had rebounded to $14.96, up 8.38% over the past 24 hours. The token remains roughly 12% lower for the week following a broader downturn across the crypto markets.
Near Protocol’s USN Stablecoin
The newly launched USN is an algorithmic stablecoin designed to maintain a 1:1 peg to the U.S. dollar through a combination of tokenomic mechanisms. The stablecoin was introduced by Decentral Bank, a decentralized organization built on the Near Protocol.
Users can mint USN by burning NEAR tokens, and conversely burn USN to redeem NEAR tokens.
Decentral Bank has indicated that early lenders may receive yields of up to 20%, positioning USN as a competitor to other yield-oriented algorithmic stablecoins such as Terra’s UST.
Reserves for USN will be managed by the Decentral Bank DAO, which plans to hold monthly votes to allocate rewards and incentives—up to $10 million—for USN liquidity and trading activities.
A Crowded Stablecoin Market
USN faces strong competition in the stablecoin space. Terra’s UST, a primary competitor, already benefits from significant USD-denominated reserve backing, reported at around $2.5 billion.
Another anticipated entrant is USDD from the Tron blockchain, which has promoted high yields—claiming up to 30% APY—on some platforms.
Many investors are taking a cautious approach to USN, awaiting broader DeFi support and utility on the Near Protocol. Market participants expect that as more decentralized finance applications integrate USN, its practical use and liquidity will increase.