Tangent cracks interest-free DeFi lending — 0% $USG loans on Curve LPs, funded by redirecting your collateral's emissions

Tangent, a DeFi protocol focused on capital-efficient stablecoin borrowing, has announced a new design for 0% interest USG loans against Curve LP tokens, where the “interest” is effectively paid by redirecting part of the collateral’s yield emissions instead of charging a variable borrow rate. The model lets LPs unlock liquidity via the USG stablecoin while keeping their LP positions productive, with emissions dynamically redirected based on USG peg conditions. Tangent’s core product is USG, an over-collateralized USD-denominated stablecoin minted against productive collateral such as Curve LP tokens and Pendle PTs, rather than idle single-asset collateral. Borrowers deposit these yield-bearing LP tokens and mint USG through a CDP-style mechanism, similar in spirit to MakerDAO and Curve’s crvUSD, but specifically optimized for LP positions. Instead of paying a traditional interest rate, users forego a portion of their collateral’s rewards (emissions) in exchange for borrowing USG at a 0% interest rate, making the loan cost a function of foregone yield rather than an explicit APR. The protocol can also route emissions to different stakeholders (liquidity providers, TAN stakers, and peg incentives), and adjusts the share of redirected rewards when USG trades off-peg to support stability. This launch sits alongside Tangent’s broader rollout, including a pre-deposit campaign (May–August 2026) that routes user USDC or frxUSD into Curve’s USDC/USG and frxUSD/USG pools ahead of USG’s mainnet release. That campaign seeds liquidity for USG, distributes upcoming TAN governance tokens to early users, and anchors the Curve pools that underlie the 0% USG loans on LP collateral. Strategically, the product targets DeFi users who already provide liquidity on Curve, Frax, Pendle, and related protocols, offering them a way to keep farming with their LP tokens while unlocking stablecoin liquidity for trading, leverage, or other strategies—without paying a traditional interest rate, but at the cost of sharing or redirecting emissions that their positions generate.

✨ AI-generated background, compiled from web sources — not editorial content.

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