MONEY: Ultra-Sound and First Interest-Bearing Stablecoin on Avalanche

  • Three types of stablecoins: “dollar backed,” algorithmic, and over-collateralized
  • We recommend the latter, as it is the only transparent type that is backed with excess funds
  • This type of stablecoin can still lose peg if the Liquidity Pools in which it trades get out of balance
  • There are two major defences against this: a variable interest-rate model and forced redemptions
  • We may be the first stablecoin protocol to implement both methods, which is why we refer to MONEY as the Ultra-Sound stablecoin
  • Interest from the variable interest-rate model will be used to launch MONEY as the First Interest-Bearing Stablecoin on Avalanche
  1. “Dollar-backed” like USDT and USDC. We use quotes to describe “dollar-backed,” because these types of stables are meant to be backed 1-to-1 dollar-to-stable, but are often collateralized differently. As a rule, these stablecoins are managed by centralized organizations in opaque ways. Some of these stablecoins present a systemic risk to crypto.
  2. Purely algorithmic like UST and IRON. These types of stablecoins are vulnerable to death spirals if the market loses confidence in the stable or its balancing asset — both can head simultaneously to zero. Made clear by recent events with UST, this category of stablecoin is not recommended, at least at this time.
  3. Over-collateralized like MONEY and DAI. This type of stable offers a margin of safety that the others do not, as they are backed by greater than a 1-to-1 ratio, with all information available transparently, in real-time, on the blockchain. Nothing is hidden, everything is executed via smart contracts — we like this, and it is why we built the MONEY stablecoin around this model.



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Moremoney Finance

Moremoney Finance

Moremoney is a protocol for borrowing against your liquidity pool tokens and other interest and non-interest bearing tokens, while still earning a healthy APY.