Abstract

mUSD is the connective tissue on Canton Network. It serves as an institutional cash layer designed first for securities-backed minting, neutral treasury settlement, and deployment into higher-yield Canton-native vehicles.

The protocol does not position itself as a homogeneous retail stablecoin, or a public-chain DeFi primitive. Rather, it is the universal cash and yield layer for the network.

• An institution holds eligible Canton-native tokenized securities — tokenized Treasuries, money-market instruments, and bonds;
• those securities are used to mint mUSD, a non-yield-bearing institutional settlement token;
• mUSD acts as the connective tissue between reserve-grade collateral and higher-yield institutional opportunities on Canton;
• a separate Institutional Yield Vault receives economic exposure to those higher-yield Canton-native vehicles while leaving the core mUSD product clean, legible, and redemption-oriented.

This separation matters. The yield product is explicit, opt-in, and structurally distinct.

Table of Contents

01Introduction

mUSD is a Canton-native stable settlement token built for institutional balance sheets, treasury workflows, collateral mobility, and repo-adjacent cash movement.

• An institution contributes eligible Canton-native tokenized securities;
• mUSD is issued through the applicable issuer-of-record pathway against that collateral under a controlled risk framework;
• Minted can then route that collateral into a separate Canton-native yield path;
• the institution keeps mUSD liquidity while also gaining access to a higher-yield institutional vehicle through its vault structure.

This design gives institutions something they do not currently have in a clean form:

• a neutral Canton-native cash leg;
• a way to unlock liquidity from reserve-grade tokenized securities;
• a controlled pathway into higher-yield Canton-native instruments without forcing the core stablecoin to become a yield product.

02Why Canton

Canton is the right environment for this product because its native design matches institutional market structure:

The protocol is designed to look like the infrastructure Canton wants — not a public-chain product awkwardly ported into an institutional network.

03Product Hierarchy

Minted is a three-layer system, in this order:

3.1 Product 1: Securities Minting

This is the lead product and the core institutional wedge. Institutions holding Canton-native tokenized Treasury or money-market securities can mint mUSD against those assets under an approved collateral and haircut framework.

3.2 Product 2: mUSD

mUSD is the base cash and settlement token. It is designed to be:

• non-yield-bearing;
• institutionally legible;
• useful in treasury, collateral, and settlement workflows;
• clean enough to act as a neutral cash leg across Canton-native applications.

3.3 Product 3: Institutional Yield Vaults

Yield is accessed only through a separate vault architecture. The vault receives economic exposure to higher-yield Canton-native instruments. That structure may issue a separate receipt, claim, or tokenized vault interest, but it is not the same as holding base mUSD.

This separation protects the clarity of the stablecoin while still letting Minted participate in the higher-yield side of the Canton ecosystem.

04Design Principles

05Securities Minting

5.1 Overview

Securities Minting is Minted's first product and primary institutional entry point. It allows institutions holding approved Canton-native securities to mint mUSD without first liquidating the underlying position. The core idea is simple:

• hold reserve-grade tokenized securities on Canton;
• use them to mint mUSD;
• retain mUSD as liquidity;
• optionally route the securities into a separate Institutional Yield Vault architecture for enhanced yield.

This is a more compelling institutional story than simply issuing a Treasury-backed stablecoin. It turns existing Canton-native securities into a source of cash, optionality, and higher-yield deployment capacity.

5.2 Eligible Collateral

The initial collateral set is intentionally narrow and Canton-native:

5.3 Minting Model

At a high level:

• the institution contributes or pledges eligible Canton-native securities;
• Minted validates eligibility and applies the appropriate haircut or advance rate;
• mUSD is minted to the institution;
• the underlying collateral can remain ring-fenced for reserve purposes or be routed into an approved Canton-native yield path through the Institutional Yield Vault architecture.

5.4 Collateral Rules

Launch parameters:

The exact advance rates depend on: issuer quality, redemption profile, transferability, market depth on Canton, legal and custody structure, and whether the collateral is being held as reserve collateral or deployed into a yield vehicle.

5.5 Why This Matters

06Token Design

6.1 Base Token: mUSD

mUSD is the base token in the system. It is a Canton-native stable settlement token: non-yield-bearing, designed for treasury, settlement, collateral mobility, and institutional cash movement, minted against approved collateral under a defined control framework. The most important design decision is that mUSD itself is not the yield product.

6.2 Yield Receipt Layer

Where Minted offers access to higher-yield Canton-native instruments, that exposure sits in a separate receipt structure, represented as:

• a vault receipt,
• a ledger claim,
• a tokenized beneficial interest, or
• a separately permissioned yield wrapper.

6.3 Why the Split Matters

Legacy token design mixed stablecoin logic, cross-domain logic, and yield logic too tightly. The revised design is simpler:

This split preserves stablecoin clarity, cleaner regulatory framing, better treasury management, and better institutional explainability.

6.4 What is Explicitly Out of Scope

The revised token model does not assume:

• public-chain DeFi deployment;
• public DEX LP positioning;
• off-network supply movement;
• institutional vault standards;
• blended retail and institutional reserve pools.

07Institutional Yield Vault Architecture

7.1 Overview

The Institutional Yield Vault is the architecture that lets Minted use mUSD as the connective tissue between reserve-grade collateral and higher-yield Canton-native instruments. The key principle is separation: mUSD remains the base cash layer; the Institutional Yield Vault is the explicit risk-bearing layer.

7.2 Core Workflow

7.3 Economic Logic

This vault architecture lets one position perform two roles:

• the institution gets mUSD liquidity;
• the same workflow can also create exposure to a higher-yield Canton-native instrument.

That is the core 'connective tissue' thesis. Minted is not merely warehousing collateral. It is creating the cash leg that lets institutions move from low-yield reserve instruments into higher-yield Canton-native structures without abandoning the Canton environment.

7.4 Example

An institution holds Canton-native tokenized T-bills. It uses those T-bills to mint mUSD. Minted then coordinates the transfer of those pledged T-bills into a Canton-native yield partner. That yield partner issues a tokenized security, for example:

• a Swiss Bearer Bond,
• a structured note,
• a tokenized private credit instrument,
• a tokenized PIK bond, or
• another approved Canton-native yield security.

That instrument is delivered into the Institutional Yield Vault, and the institution receives economic exposure through the vault rather than through the base stablecoin.

7.5 Distribution Policy

Yield generated by the underlying instrument is distributed through the Institutional Yield Vault according to the governing terms of that vehicle. At a high level:

• gross yield flows from the underlying Canton-native yield instrument;
• Minted retains its negotiated spread, coupon, or routing fee;
• net proceeds flow to the institutional participant.

08Canton-Native Yield Vehicles

8.1 Target Vehicle Categories

8.2 Selection Framework

An institutional yield vehicle is considered eligible only if it is:

• natively aligned with Canton workflows;
• legally legible as a security or contractual claim;
• operationally supportable by the relevant custody, control, and securities oversight stack;
• capable of supporting institutional reporting and payout administration.

09Peg Stability and Liquidity Controls

9.1 Peg Philosophy

mUSD maintains its stability through:

• conservative collateral policy;
• clearly defined advance rates;
• ring-fencing between stablecoin liabilities and yield risk;
• contractual unwind rights where collateral is routed into yield structures;
• disciplined treasury and liquidity buffers.

9.2 mUSD is Not Funded by Yield Assumptions

The peg does not depend on optimistic coupon assumptions, strategy markups, future yield distributions, or speculative liquidity. The stablecoin must remain understandable even if no higher-yield vehicle is active.

9.3 Segregation Rule

The protocol maintains a hard conceptual and operational split between the mUSD reserve and settlement layer and the Institutional Yield Vault layer. This is one of the most important controls in the system.

9.4 Stability Controls

10Compliance and Securities Oversight

10.1 Why This Matters

The Minted model touches two different regulatory realities:

• a payment / settlement stablecoin; and
• securities workflows around tokenized debt, bearer bonds, structured notes, and similar instruments.

Those are not treated as the same.

10.2 Stablecoin Side

The base mUSD product is designed as a non-yield-bearing stable settlement instrument. That is the cleanest path for institutional adoption and the most coherent regulatory posture.

10.3 Securities Side

Where Minted coordinates issuance, placement, transfer, or distribution of tokenized yield instruments, the protocol may require:

• broker-dealer oversight;
• transfer-agent support where an actual security issuance requires it;
• ATS support where trading or secondary liquidity becomes relevant;
• asset-control, custody, and settlement partners for the underlying security movements.

The purpose of this whitepaper is not to prejudge the precise legal wrapper for every Canton-native yield vehicle. The purpose is to make clear that Minted treats those workflows as securities workflows first, not as crypto routing.

10.4 Institutional Onboarding

Institutional participation in Securities Minting and Institutional Yield Vaults remains subject to:

• KYC / KYB;
• suitability and eligibility checks where required;
• sanctions screening;
• counterparty and asset approval processes;
• program-specific legal documentation.

11Governance and Asset Approval

11.1 Governance Scope

Governance controls:

• approved collateral types;
• advance rates / haircuts;
• eligible yield vehicle list;
• custody / asset-control partner approvals;
• service-provider approvals where securities workflows are involved;
• concentration limits and risk caps.

11.2 Asset Approval Policy

No asset is accepted into the core minting framework or Institutional Yield Vault framework merely because it exists on Canton. Approval must consider:

• legal form;
• issuer quality;
• redemption profile;
• transferability;
• accounting treatment;
• control and settlement mechanics;
• concentration risk.

12Security and Operational Model

12.1 Security Model

The design reduces avoidable operational risk by keeping the base product narrowly focused:

• external transfer-wrapper risk in the base product;
• multi-ledger mint / burn synchronization risk;
• public-network composability risk in the base product;
• DeFi strategy contagion risk.

12.2 Operational Dependencies

The main operational dependencies are:

• Canton contract integrity;
• asset-control and custody confirmations;
• legal and operational integrity of approved yield partners;
• payout, reporting, and reconciliation accuracy;
• service-provider coordination for security issuance and transfers.

12.3 Reliability Principle

13Risk Analysis

14Roadmap

15Glossary