Leveraged Set Dollar — FAQ
What is LSD?
LSD is an ERC-20 self-stabilizing decentralized censorship-resistant non-collateral backed USD stablecoin. It uses a supply elasticity method around a Time Weighted Average Price (TWAP) for price stability. It leverages TWAP to maintain the price at $1. LSD combines the robustness of distinctive stablecoin projects that came before it.
LSD is an algorithmic stablecoin — with an aim to maintain the price at $1, but is it different? Yes, It is inspired by Dynamic Set Dollar (DSD) and Empty Set Dollar (FSD), yet reacts faster to market interest through more successive epochs, extensive supply caps, and a revised supply extension/contraction formula.
LSD provides a shorter lock period in DAO and LP and more aggressive incentives to Liquidity Providers.
Who created Leveraged Set Dollar?
An anonymous team with experienced solidity developers.
Does the team control LSD?
Since launch Leveraged Set Dollar has had on-chain governance. This means that any changes or upgrades to the protocol need to be voted on by the community of token holders before they are enacted.
How does LSD’s supply grow?
LSD uses an elastic supply mechanic. As market demand for LSD increases, the price of LSD increases above the 1 USD peg, which causes new LSD to be minted. This increases the supply of LSD, returning the price of LSD to the peg. There are several ways newly minted LSD are distributed. In the event of supply extension, 50% of the newly minted LSD will return to LSD holders that have bonded their LSD inside the DAO, while the remaining 50% return to Uniswap Liquidity Providers/Oracle. Lastly, LSD features a built-in debt market that handles supply contraction phases (LSD price < $1). Once the debt has been created, LSD token holders can burn their LSD to acquire Coupons. Coupons will be redeemable for newly minted LSD during a supply expansion event. When burning LSD for Coupons, there is always a discount applied depending on the debt ratio.
Important to note is that the supply of LSD changes through the voluntary actions of users. Your wallet balance will never increase or decrease without your volition.
Mechanics:
- 1 hr epochs
-DAO lock up 72 epochs (3 days)
-LP lock up 24 epochs (1 day)
-Supply change limit 5%
-DAO/LP rewards split 50/50
-Governance
-USDC pool
