Minting & Backing
thUSD is the foundation of the Tharwa ecosystem, a stablecoin designed to be both safe and productive. Unlike traditional stablecoins that sit idle or rely on volatile crypto collateral, thUSD is backed by a diversified portfolio of real-world assets and dynamically managed to maintain stability, yield, and capital efficiency.
Minting thUSD isn’t just an entry point into the system. It’s the start of a full-cycle capital flow that mirrors the logic of how sovereign wealth funds and hedge funds operate off-chain — now available on-chain.
How thUSD is Minted
Minting thUSD is straightforward. Users deposit USDC, USDT or DAI into the protocol. These assets are then deployed into a risk-managed portfolio of tokenized real-world assets.
The amount of thUSD minted is always equal to the deposited value, 1:1, and all collateral is transparently held in smart contract-controlled vaults, with daily reporting on asset flows and NAV.
To prevent manipulation or liquidity shocks, only whitelisted custodians and smart contracts can mint or redeem large amounts of thUSD. This helps safeguard the peg and ensures reserves are never distorted by bad actors or flash loan attacks.
What Backs thUSD?
Every thUSD is fully backed by a diversified portfolio of real-world assets — selected not just for yield, but for resilience across market cycles. These assets are chosen based on liquidity, risk profile, and macro alignment, then actively managed by our AI-powered Confluence Engine.
Current backing includes:
Sukuk – fixed-income, asset-backed instruments aligned with faith-based finance principles
Gold – a long-standing hedge against inflation and systemic shocks
UAE Real Estate – high-yield, regulated property exposure offering regional diversification
Oil (capped) – uncorrelated upside potential, strictly limited to reduce volatility
No single asset class is allowed to exceed 33% of the portfolio. High-volatility assets like oil are limited to less than 3%, ensuring thUSD maintains a strong risk-adjusted profile.
All assets are tokenized and held in fully transparent smart contracts, with monthly yield flows tracked and audited. The collateral is real, it’s visible, and it’s working.
Structured Minting Cycle
Tharwa doesn’t just wrap assets. It orchestrates a structured capital cycle that flows like this:
Users deposit stablecoins to mint thUSD
Those stablecoins are deployed into real-world yield strategies
Yield flows back into the protocol, where it’s used to support sthUSD and TRWA rewards
Peg defense mechanisms and redemption flows maintain liquidity and price parity
This cycle ensures that every minted thUSD is both backed and actively deployed. There is no idle capital, no recursive rehypothecation, and no black-box risk.
Why This Matters
Most stablecoins either prioritize liquidity or yield. Very few attempt to do both. Even fewer can do so while managing real-world asset risk and maintaining 24/7 peg stability.
By creating a minting mechanism tied to an actively managed portfolio of diversified assets, thUSD offers:
Full collateral transparency
Real yield from day one
Structured capital deployment
Peg defense with deep liquidity access
Scalability through automation, not manual governance
This turns thUSD into something more than a dollar proxy. It becomes a programmable treasury unit — stable by nature, productive by design.
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