TL;DR

Nouns has 484,743 USDC sitting idle.

This proposal moves 300,000 USDC into OUSD so the USDC can earn a yield while waiting to be used for other proposals, while still remaining fully accessible to the DAO. It also wraps it to remain compliant with the DUNA.

OUSD is a fully liquid stablecoin - converting USDC to OUSD does not lock up any funds, so there is no opportunity risk of funding other proposals with these tokens by converting some USDC to OUSD.

• No funds are locked.
• No funds are spent or given to a third party.
• The DAO can convert OUSD → USDC at any time.
• wOUSD and OUSD are fully liquid.
• 184,743 USDC remains in native USDC immediately after execution.
• If a future proposal needs more USDC, the DAO can redeem any or all of this position first. This proposal does not prevent, delay, or compete with future spending proposals.

At the current estimated yield of ~5.15% APY, 300,000 USDC would generate roughly $1,287/month (~$15,450/year), while the DAO keeps fully control and liquidity.

This proposal was modeled after recent staking proposals that the DAO ratified.

What this proposal does

Think of this as moving part of the DAO’s idle cash from a checking account into a yield-bearing version of the same cash. Like converting the DAO's ETH into stETH !

Why do this?

Idle USDC earns nothing. This proposal lets the DAO earn yield on a portion of that balance without sacrificing the ability to fund future ideas.

The expected yield can help fund: future proposals, operating costs, purchases of additional ETH, direct donations to charity, or simply increase the DAO’s USDC balance over time.

Most importantly: if a better use of OUSD funds appears tomorrow, Nouns is free to use the funds tomorrow - because OUSD is fully liquid.

Why wOUSD instead of OUSD?

OUSD earns yield automatically via rebase (think of it like a dividend directly to your wallet). It distributes yield in the same way stETH has distributed yield to the Nouns DAO over the last several years before it was converted into wstETH. wOUSD is simply the wrapped, non-rebasing form of OUSD.

It earns the same underlying yield, but the value accrues in the token’s exchange rate rather than by increasing the number of tokens held. That format is generally simpler for treasury accounting and avoids daily rebasing activity.

Wrapping does not create a lock-up. It is reversible at any time.

Wait...how does OUSD earn yield?

OUSD puts deposited USDC to work in onchain strategies instead of leaving it idle.

In simple terms: borrowers and liquidity markets pay fees or interest to use the capital. Those earnings flow back to the OUSD vault, increasing the value held by OUSD and wOUSD holders.

OUSD's current strategies include:

• Lending USDC through Morpho on Ethereum mainnet, Base, and Hyperliquid.
• Deploying USDC to a Curve AMO (automated market-operations strategy).
• Automatically claiming MORPHO, CRV, and CVX rewards and converting them into more stablecoins.

OUSD holders receive this yield automatically. wOUSD receives the same yield, but it appears in the growing wOUSD-to-OUSD exchange rate instead of as a growing token balance.

Yield rates change with market conditions, but are paid out daily without interruption.

Risks

This is not risk-free. The relevant risks are smart-contract and stablecoin risk:

• OUSD relies on smart contracts and external yield strategies.
• OUSD is backed by USDC, so it shares USDC-related risks.
• Yield rates can change and are not guaranteed.

Origin has operated OUSD since 2020, has undergone 12+ audits (some by the same auditing firm than Nouns used), maintains a bug bounty program, and uses established DeFi venues for its strategies. More detail and links can be included for anyone who wants to evaluate the technical risk.

Transactions

There are 4 transactions involved: approve, mint, approve, and deposit

• USDC ‘approve’
  • approves the usage of the USDC from the Nouns DAO treasury
  • USDC uses 6 decimal places, so 300000000000 = 300k USDC
• OUSD vault ‘mint’
  • mints OUSD using USDC at a 1:1 rate
• OUSD ‘approve’
  • approves the usage of the OUSD from the Nouns DAO treasury
  • OUSD uses 18 decimal places, so 300000000000000000000000 = 300k OUSD
• wOUSD ‘deposit’
  • wraps OUSD into DUNA compliant wOUSD