KUSD is a token emitted to Knoxer holders. Knoxers can vote through governance on what to do with KUSD. Because of the inflationary nature of KUSD, it shouldn't be treated as a stablecoin.
Rarer Knoxers will receive more KUSD/week because rarer Knoxers (namely LydianKnoxer, MegaKnoxer and SuperKnoxer) hold the responsibility to make good decisions for the DAO.
In order for KUSD to be useful, LydianKnoxers, MegaKnoxers and SuperKnoxers have the incentives to contribute and make quality DAO decisions.