> For the complete documentation index, see [llms.txt](https://guide.dem.exchange/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://guide.dem.exchange/earn/nitron-lend-and-borrow/usc-stablecoin.md).

# USC Stablecoin

## Introduction

USC (Carbon USD), is Demex's native stablecoin that follows the battle-tested MakerDAO's Collateral Debt Position (CDP) model that mints the DAI stablecoin. 

This over-collateralization mechanism ensures that each USC is always backed by more than $1 worth of collateral.

{% hint style="info" %}
The name "Carbon" is a legacy codename and no longer means anything.
{% endhint %}

## How It Works

USC is backed by other digital assets that are put up for collateral to mint the USC tokens, on demand.

USC tokens is minted when a lender collaterizes their lent assets, and mints USC. This is known as a collateralized debt position (CDP).

The interest rate of USC is dynamic based on its current price and is engineered to peg the coin to 1 USD eventually. As CDPs are always over-collateralized, depegging should not last for long periods. Read more about the interest rate model here.


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