
USDx has been launched by dForce as the first monetary protocol, which is a decentralized and synthetic indexed stablecoin. USDx is pegged by a basket of constituent stablecoins at a pre-determined weighting, which can be adjusted via on-chain governance.
As we launched USDx protocol, the initial reserve comprises of four constituent stablecoins, with the following weighting: 30% USDC, 30% TUSD, 30% PAX and 10% DAI. As a decentralized stablecoin protocol, constituent portfolio and their respective weightings can be adjusted by DF holders via governance poll.
There are a few concerns we have with DAI which lead us to the proposal for removing DAI from USDx reserve and we would like to propose a governance poll through voting system for DF holders to cast your vote on a removal (temporary or permanent) of DAI from USDx reserve basket.
Our reasons for the removal of DAI are as follows:
1. DAI is an over-collateralized stablecoin with very different design from fiat stablecoins (i.e USDC, PAX, TUSD), where its dollar peg are based on market demand and supply, which ensures no dollar redeemability, the lack of redeemability introduce friction into USDx’s stability and ability to have full convertibility against other fiat-stablecoins.
2. The upcoming launch of Multi-Collateral DAI (MCD) and DAI Saving Rates (DSR) may increase the complexities and challenges for DAI to maintain its peg and the migration also risks de-pegging sDAI. There are significant unforeseen risks associated with including DAI into our reserve basket without knowing the potential side effects introduced.
3. High friction and transaction costs associated with acquiring DAI (inefficient on-ramp and limited OTC services).
IMPORTANT: Implications
This proposal is an attempt to improve stability of USDx and ensure dollar redeemability. No action is required from existing USDx users — you will not be forced to redeem USDx, or withdraw constituents. This proposal only represents a change to reserve constituents and the weighting of underlying reserve of USDx which has no inherent impact on its dollar peg.
· Current weighting: 1 USDx = 30% USDC + 30% TUSD + 30% PAX + 10% DAI
· Proposed weighting: 1 USDx = 35% USDC + 35% PAX + 30% TUSD
Implication and Process Explained:
After activation of the proposal, all new mintage of USDx will follow the new proposed weighting above (35% USDC + 35% PAX+ 30% TUSD), i.e deposit of 35 USDC, 35 PAX, 30 TUSD will mint into 100 USDx.
On disaggregation, i.e if you disaggregate 100 USDx, it will turn into 30 USDC, 30 TUSD, 30 PAX, 10 DAI, until DAI is fully drained from the inventory.
The following diagram elaborates the process:

Voting Mechanism
· The governance poll will last for 5 days from 4 to 9 November.
· All DF holders will have the opportunity to signal your support for the reserve adjustments for USDx through the voting system;
· Proposal will be implemented if the following requirements are satisfied:
- Quorum: >5% of total DF tokens at the end of the voting period need to have participated in the voting
- Threshold: >50% of the DF tokens that participated in the voting need to have voted ‘Yes’ for the proposal (If the voting result is tied, the proposal won’t be implemented.)
· Governance decision will be disclosed through Medium and Twitter before 10 November.
Execution Plan
Reserve constituent adjustments will be carried out in accordance with details following:
- From 10 to 11 November (inclusive), users will have the right to get back your reserves at pre-determined weightings (30% USDC + 30% TUSD + 30% PAX + 10% DAI)
- From 12 November onwards, new mintage attempts will be automatically switched to adjusted weightings.
- Effective from 12 November, DAI inventories will be consumed on a first-In-First-Out (FIFO) basis during the process of disaggregation, which means, a user should expect the return of DAI amounting to 10% of disaggregated USDx, until draining of DAI inventories.
Join us for an online discussion! We’d love to hear your voice!

