Phase 2 – Engine & Liquidity

Phase 1 proved that thUSD works. Phase 2 is about turning it into something people want to hold.

This phase is where Tharwa’s infrastructure starts compounding: vaults get smarter, yield gets distributed, and liquidity moves beyond simple DEX pools. The Confluence Engine begins actively managing the portfolio, and the foundation is laid for scalable integrations — across both DeFi and institutional rails.

This is the first phase where protocol logic starts to feel alive.

What Phase 2 Unlocks

The Confluence Engine Goes Live

• Active optimization of RWA allocation begins using AI agents and CVaR-based strategies

• The engine continuously adjusts vault exposure to protect against tail risk while seeking real yield

• Real-time analytics and on-chain signals drive portfolio decisions — this is no longer a static vault system

This marks the transition from a passive treasury to an actively managed, risk-aware capital machine.

sthUSD Launch

• Users can stake thUSD to receive sthUSD — a yield-bearing asset that distributes real RWA returns in thUSD

• sthUSD is ERC-4626 compatible, enabling integrations with DeFi protocols and future automated strategies

• Yield flows through vault activity, not emissions — holders earn real returns, not just token inflation

Risk-On Vault Expansion

• Additional vaults with higher yield strategies go live, including longer-duration sukuk, oil-backed tranches, or mixed commodity exposure

• Vaults remain separated by risk profile and, where applicable, by compliance principles (e.g. faith-aligned vs global market)

thUSD Liquidity Programs

• LP incentives are introduced for select thUSD pairs on Ethereum and other target chains

• DEX liquidity is deepened with protocol-owned support and strategic market maker engagement

• OTC desk architecture is further developed to support high-volume mint/redeem flows with minimal slippage

This lays the groundwork for thUSD becoming a widely accepted unit of account, not just a mint-and-hold token.

sTRWA Staking Activation

• TRWA stakers can lock their tokens to receive sTRWA

• sTRWA will be used for governance voting, future yield share, and vault access rights

• Alignment is rewarded — longer lock = stronger say

Strategic Goals of Phase 2

This is the moment where yield meets structure. The goal isn’t just to offer returns — it’s to offer sustainable, risk-adjusted returns that can survive outside of a bull market.

It’s also the phase that pushes liquidity from isolated pools into a broader system of integrations and on-chain activity. With sthUSD and vaults functioning as intended, thUSD becomes more than a placeholder — it becomes an income-generating asset with purpose.