The uWatt: A liquid digital asset backed by the Reserve

The uWatt is the Suno Protocol’s liquid, energy-backed digital asset. It represents a proportional claim on the Reserve, a pool of operational clean energy projects. As the Reserve grows and generates income, uWatt holders receive a share of that income, making the uWatt a yield-bearing asset with tangible real-world backing.

Role and Function

Unlike pWatts, which are tied to individual projects, the uWatt abstracts value from the entire ecosystem. It is a fungible token that aggregates income across all projects in the Reserve, offering a stable and diversified return profile. This makes it an ideal instrument for participants seeking exposure to clean energy infrastructure without the complexity or risk of selecting and managing specific projects.

In addition to serving as a store of value and yield-bearing asset, the uWatt also plays a crucial role in improving the liquidity of individually tokenized projects. By allowing pWatt holders to convert their project-specific tokens into uWatts—backed by the broader Reserve—the Protocol unlocks access to a larger, unified secondary market. This helps solve the problem of liquidity fragmentation typically associated with isolated, project-level tokens and creates a fluid path for capital to move from specific assets into a pooled, diversified financial layer.

The uWatt thus functions as both a reserve asset and a liquidity mechanism, enabling long-term capital preservation while giving participants optionality and flexibility across different stages of project maturity.

Issuance and Backing

New uWatts are issued exclusively when pWatt holders of operational projects choose to transfer ownership of their tokens to the Reserve. In return, they receive uWatts in an amount equivalent to the intrinsic value of the contributed project. This value is calculated by the Protocol based on the Net Present Value (NPV) of the project’s expected future income.

This issuance process ensures that every uWatt is fully backed by productive, income-generating infrastructure. It also creates a strong incentive for pWatt holders to contribute to the Reserve—especially in the early stages of a project’s operational life, when the intrinsic value often exceeds its original acquisition cost.

Liquidity and Market Participation

Because uWatts are fungible and backed by a diversified pool of assets, they can serve as the primary liquidity layer of the Suno ecosystem. Participants can acquire uWatts through decentralized markets, hold them to earn passive yields, or use them in composable DeFi applications built on top of the Protocol.

The liquidity of the uWatt stands in contrast to the illiquidity of traditional infrastructure investments or even individual pWatt tokens. It enables a new model of climate finance at scale, where capital can flow efficiently while remaining transparently backed by real assets.

Strategic Impact

The uWatt transforms fragmented project-level ownership into a unified, composable, and scalable financial instrument. It simplifies access to the energy economy, improves liquidity for long-term asset holders, and serves as a foundation for new forms of ESG-aligned financial products.

By linking token issuance directly to infrastructure deployment—and by tying yields to real energy production—the uWatt makes clean energy both investable and programmable. It is the mechanism through which Suno converts energy infrastructure into a digital asset class designed for global adoption.

uWatt Reference Value

The uWatt is an ERC-20 token that can be freely transferred and traded across centralized exchanges, decentralized platforms, and peer-to-peer markets. As such, its market price is determined by supply and demand and may fluctuate accordingly. There is no protocol-enforced price for the token in open markets.

However, by design, the total supply of uWatts is constrained by the real-world value of the Reserve—a pool of clean energy infrastructure projects. Each uWatt represents fractional ownership of this Reserve, and the Protocol defines an intrinsic value benchmark for the token: the uWatt reference value.

This reference value is calculated as:

$$\textnormal{uWatt Reference Value} = \frac{\textnormal{Total Value Locked (TVL) in the Reserve}}{\textnormal{Total uWatt supply}}$$

The Total Value Locked reflects the aggregated value of all projects held within the Reserve. Each project is individually valued using a Net Present Value (NPV) model that accounts for its expected future cash flows. The Reserve's ownership of each project is represented by its holdings of pWatts, which function as on-chain certificates of project ownership.

To support price stability, the Protocol also includes a cash-out mechanism that allows qualified participants to redeem their uWatts for real-world value, based on the reference valuation. This feature creates a natural arbitrage incentive that helps align the market price of the uWatt with its intrinsic value—minimizing deviation between the two and reinforcing the economic credibility of the asset.