It’s with great pleasure that we, the empty set squad, introduce døllar: a fully decentralized elastic-supply stablecoin. Its construction is an iteration on Basis and its predecessors, aiming to solve core issues within their mechanics. To translate to Ethereum, we incorporate ideas from 0x Staking, Rho, and build on top of Uniswap V2 oracles.
motivation.
Collateral-based stablecoins are both capital inefficient and carry risk to the underlying collateralized assets. Additionally, the total supplies of these stablecoins are constrained to strictly less than the available reserve assets on-chain. By iterating on existing primitives, and learning from prior experiments, we aimed to create an elastic-supply stablecoin not bound by these limitations.
design.
We value simplicity over perfection. Over-complicating mechanism design can lead to unintended side effects. Instead, døllar strives to achieve a minimum viable mechanism which can remain secure while solving the underlying problem, but has ample room for improvement via its decentralized governance system.
stability.
døllar is a single-token protocol. ESD is both the stablecoin as well as the vessel with which DAO stake can be claimed via bonding. Bonded ESD allows the user to claim future supply extension rewards as well as participate in governance.
Price stability is based on an elastic supply model. To expand supply, new ESD tokens are minted and granted to bonded ESD holders or used to pay off protocol debt. When a contraction is necessary, ESD may be burned for a premium quantity of coupons, which can later be redeemed 1:1 for ESD when the supply once again extends.
bootstrapping.
Two mechanics work together to distribute the initial supply of ESD tokens. Epochs must be advanced manually by calling the advance() method on døllar’s DAO. The first user to successfully call this method each epoch is rewarded with 100 ESD. Additionally, for the first 30 days, døllar’s price oracle is fixed at 1.10 USDC, resulting in a 10% supply extension every 8 hours to bonded ESD holders.
participate.
døllar is live on mainnet. To participate in the protocol, visit the døllar dashboard here, or for greater security, build and run the dashboard locally from source here.
safety.
This project is an experiment, and its contracts are unaudited — we’ve put a significant amount of work into testing, as well as generally de-risking the design of its core mechanism, however participants should take great caution as bugs resulting in loss of funds are always a possibility.
the squad.
We are a collective of pseudonymous builders working to create a more open financial system.
connect.
welcome, yøu are here. 💔
