alUSD & alETH

Deposit assets, debt assets and governance are different roles

USDC and ETH are the documented v3 underlying deposit assets described in this guide. alUSD and alETH are synthetic debt assets associated with those denominations. MYT represents pooled yield-bearing collateral. ALCX serves a governance role; it should not be confused with the token issued as a dollar-denominated or ETH-denominated loan. Similar names within an ecosystem do not imply identical use, backing or risks.

Version and chain matter when reading a token list. A token mentioned in an older tutorial or in an underlying strategy is not necessarily available as a direct deposit in the market you intend to use. Check the selected app market and the official integrator FAQ. The protocol component walkthrough puts each asset role into the loan cycle.

A target denomination does not guarantee an exchange quote

alUSD targets a dollar denomination, while alETH targets an ETH denomination. Those reference units help explain the corresponding debt, but do not guarantee the price offered by an exchange. A trade depends on available liquidity, transaction size, fees and execution conditions. A displayed reference price is not the same as a firm quote for the amount you want to sell.

For borrowers, this matters because selling an alAsset at a discount changes proceeds without automatically changing protocol debt. For buyers, a discount alone does not establish a risk-free return. The cost of purchasing, the route to redemption, the waiting period and payout conditions all affect the outcome. The worked pricing and redemption examples show these distinctions.

Understand the waiting period before using the Transmuter

A redemption position has terms that need to be reviewed before committing. The target at maturity should not be interpreted as an immediate cash withdrawal on demand. Early exit follows its own treatment of vested and unvested value, and bad debt can affect payouts. Confirm the applicable asset, chain, maturity and fees in the official app rather than assuming all redemption positions share one universal duration.

Waiting also has a practical cost even when you do not label it as interest. Funds committed to a position may be unavailable for another need, and your circumstances can change before maturity. Compare that commitment with the net proceeds of an immediate exchange sale. Neither path is automatically preferable for every token holder.

Borrowers and token buyers face different questions

A borrower must manage the collateral and debt position that issued the tokens. Someone buying tokens on an exchange may not have that same loan position, but still needs to understand market liquidity and redemption conditions. Holding an alAsset in a wallet is therefore not proof that the holder deposited collateral or has the same obligations as its original borrower.

Likewise, an alAsset transfer is not itself evidence that an associated loan was repaid. Check the appropriate position balances after settlement. Read the transaction checklist for borrower checks and the security overview for risks that can affect both users.

Common alAsset questions

Is alETH a dollar stablecoin?

No. Its reference denomination is ETH, so its dollar value can move with ETH even if its ETH exchange relationship stays close to target. Choose the debt denomination with your actual spending needs in mind.

Does an alUSD discount erase a borrower's debt?

No. Exchange pricing and the debt recorded by the protocol are separate. A cheaper exchange quote is relevant to a possible transaction, not an automatic reduction of a loan balance.

Where can I verify current redemption conditions?

Use the official Transmuter documentation and the selected market in the app. For the effect of redemptions on borrower collateral, continue to the self-repaying loan explanation.