Aug 29, 2020
The first and best decentralized interoperable money market
Get access to cross-chain liquidity
About this project
How do you turn your volatile crypto assets into a stable store of value? How do you leverage your digital holdings for access to a new, secure form of money?
EOSDT’s core components work in concert to let users generate stablecoins pegged to the US dollar and backed by their own crypto holdings. The EOSDT stablecoin is a useful store of value with a variety of applications, like hedging against market turmoil, providing fiat-like quotes for currency pairs on decentralized exchanges, and even making online payments with merchants that accept cryptocurrency. It allows for more intuitive crypto transactions — one EOSDT always equals one USD.
There are four main smart contracts, operating as follow:
The market data smart contract references cryptocurrency prices from the external market through a trustline provided by Oraclize.it, Delphioracle, and LiquidApps.
The Position Smart Contract receives a user’s cryptocurrency and holds it without any human involvement or custody risk.
The Liquidation Smart Contract lets “guardians” and market participants make money by liquidating under-collateralized user positions. This happens automatically when their collateral drops below the critical level of 130%. Guardians can claim liquidated collateral or surplus EOSDT at a markdown from current market prices, an associated fee will be payable in NUT tokens, which are then redistributed back to the system.
The Governance Smart Contract lets users who hold NUT tokens submit proposals to change the EOSDT parameters on risk and stability. NUT holders can also vote for a list of EOS block producers they want to support with system’s EOS collateral. This feature drives the growth, development, and maturity of the entire EOS ecosystem.
EOS uses a delegated proof-of-stake concept, which grants the community lots of flexibility in making instant high-level decisions, like rollbacks and bug fixes, by majority among designated stakeholders. This approval voting system stakes the top 21 EOS block producers to produce blocks — EOS token holders must stake tokens for three days in order to vote. The top 21 candidates form the block-producing core, and the rest become backup block producers. Their priority is also determined by the number of votes they get.
Staking an EOS coin is like paying an opportunity cost — you can’t unstake it until three days later, and you don’t have any access to it until then. This little cost grants you access to the entire EOS system. If you stake them for bandwidth, it means you can send transactions, and the size of transaction will consume your bandwidth.
EOSDT uses the EOS blockchain because it is faster than Ethereum, has near-zero transaction fees, and offers great infrastructure for implementing cross-chain solutions. It presently supports the EOS cryptocurrency as a collateral and is ready to support other collateral assets.
Technology review
The best decentralized applications not only offer fast transaction processing times, but an infrastructure robust enough to offer a high-quality experience to lots of users at once. EOSDT is the first stablecoin built on Equilibrium, which is an EOS-based multichain framework for crypto-backed stablecoins and DeFi products. Equilibrium in turn is built on the EOSIO technology stack because it offers decentralized storage and general purpose infrastructure for running EOS dApps more effectively than competitors. Transaction fees are effectively zero here, there’s a thoughtful resource balancing process, and transaction processing times are faster. These features substantially distinguish EOSIO technology from other second-generation blockchains currently on the market.
Stability
EOSDT’s stability comes from backing the EOSDT supply with the equivalent amount of USD collateral at minimum. EOSDT is pegged to the value of $1 USD to achieve this. An external price feed values the collateral, and the system constantly monitors the ratio of collateral to the total EOSDT supply to make sure it always meets the minimum threshold
There are several external actors and internal mechanisms that help maintain market equilibrium.
Guardians
These are actors willing to profit on EOSDT’s price deviations from the $1 USD peg. The mechanics behind arbitrage are pretty straightforward: when the price of EOSDT rises above $1 USD, there’s added incentive to generate it by supplying collateral and selling it on the market. This increases the supply of EOSDT and brings its price down to $1 USD.
When price of EOSDT falls below $1 USD, there’s an incentive for position holders to buy EOSDT on the open market and pay back their positions. This reduces the supply of EOSDT and brings its price up to $1 USD.
Market-makers
These are large actors who generate a lot of EOSDT for their massive collateral stakes. They’re willing to make the market at various exchanges by profiting on the price spread between EOSDT and USD.
Equilibrium fee
Changes to the equilibrium fee incentivize position holders repay or expand their EOSDT holdings, consequently pushing EOSDT price up or down until it finds equilibrium. The system applies the Equilibrium fee every time a user takes an action, and calculates this fee based on an annual percentage rate defined by governance smart contract. Since launch, the Equilibrium fee has been set to 0.0% APR.
If there’s an excess market supply of EOSDT, governance may decide to raise the applicable fee to induce position holders to sell off their “expensive” positions, lowering the supply of the stablecoins. If there’s excess demand for EOSDT, governance may lower the interest rate to induce users to enter more “cheap” positions, increasing the total supply. This is reminiscent of how central banks adjust short-term interest rates to control the economy’s supply of money.
What sets us apart?
All in one place
All main DeFi use cases on one easy interface
Cross-chain enabled
Polkadot bridges provide trustless cross-chain interoperability
Highest possible liquidity
Solving chronic DeFi issue via attracting institutional clients on multiple platforms
Bailouts vs. auctions
Liquidity ensured against debt default in adverse markets
Advanced features
Bailouts
Provide liquidity in advance to secure loans in the system and to earn additional yield
Programmatic interest rate
Get fair interest on loans based on the algorithmic risk assessments
Built-in cross-chain DEX
Trade assets of multiple platforms on margin and
using advanced order types
All DeFi united in one place
With Equilibrium you can:
- Lend
All main crypto assets
EQ tokens - Stake
PoS & DPoS crypto assets
EQ tokens - Trade
All main crypto assets
Decentralized stablecoins
Synthetic assets
EQ tokens - Borrow
All main crypto assets
Decentralized stablecoins
Synthetic assets
3-layer proactive system solvency protection
Partners:
HitBTC
Bancor
MYKEY
Huobi Global
Provable
EOS NATION
TOKEN POCKET
Newdex
Freewallet
Crypto locally
EOS Authority
EOSFinex
Bloks.io
Changelly
LUMI EOS
CANNON
BINANCE
Morecoin
Thanks for reading!
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