ARTH to Launch as a Seigniorage Share— Beta Program Announced

Published in

MAHA

5 min readJan 6, 2021

The time has finally come. Today we are excited to share with the MahaDAO community a groundbreaking development that has been in the making over the last few weeks: ARTH will be using Seigniorage Shares to maintain its stability as opposed to collateral backed system.

Seigniorage Shares are a concept for an algorithmic stable token that uses smart contracts to fulfill the role of a central bank to formalize and automate monetary policy mechanisms so the token trades at a stable price. This ‘elastic’ supply mechanism has been designed for ARTH to either stimulate the contraction or expansion of the token supply, similar to how central banks control the supply of fiat currencies.

Seignorage shares are a cutting edge concept that will revolutionize how stablecoins operate and MahaDAO will have a first-mover advantage on other DeFi projects. It’s taken months of research by the team to find the optimum solution to attain a value-backed stablecoin, that can now increase and decrease the token supply in a resilient way.

Why move away from CDPs to Seigniorage Shares?

Collateralized Debt Positions are what legacy decentralized stablecoins (like DAI) used to maintain the target price. This involved having some kind of asset being locked into a smart-contract as collateral and issuing the stablecoin against that collateral.

However one of the key inefficiencies with this model is that it limits growth only up to how much collateral can be locked in.

Seigniorage coins or Elastic stablecoins are algorithmic coins that are minted/burnt basis how much demand there is for the token without having any underlying collateral. These coins are not restricted in terms of growth the same as CDP-based stablecoins are but also face the issue that in the initial phases it can become highly volatile.

With that being said; We at MahaDAO have decided to migrate to the Seigniorage Share model to allow for wider growth and adoption for the $ARTH stablecoin.

Enforcing Stability with Seigniorage Shares

Seigniorage Share coins work in a special way where the supply of the coin is driven by purely a function of market demand for the token.

If $ARTH is trading above its target price, then the protocol will mint new $ARTH tokens so as to bring the price down to the target.

If $ARTH is trading below its target price, then the protocol will issue bond tokens (in the form of debt) that’ll buyback and burn the $ARTH tokens, bringing the price back up to the target price.

But as we have seen that most elastic coins do through suffer short-term volatility. Hence to counter this, specific key measures will be introduced and explained in future articles to showcase what MahaDAO will do to enforce stability.

Key features of the ARTH stablecoin platform

For those familiar with the existing elastic stablecoin platform, here are the key features of the ARTH platform:

Epoch interval: 12 hours
Target Price: The Global Measurement Unit
Bond Redemption Fees: 1% paid in $MAHA

A detailed Gitbook detailing the entire system is being prepared by the MahaDAO team and it will be made public once ready.

Note: these may be subject to change depending on the Beta Round results

Taking the best out of all elastic stablecoin protocols

ARTH is a fork of Basis Cash with major changes taking inspiration from MakerDAO & ESD. It has been carefully studied and evaluated upon going through all the discussions around the pros and cons of the various elastic stablecoins.

The founders themselves have spent countless hours going through forums, participating in discussions both internal & external.

For a full well-detailed description; you can check out our Gitbook documentation (which is currently under development) and discussions (including proposals and improvement protocols) are welcome on our Telegram group.

Smart-Contract Audits

The smart-contract code is an indirect fork of Basis Cash, which is already audited and the changes made are with respect to the various debt parameters and oracles. The changes are made public on Github.

The MahaDAO team further intends to have more audit firms review the code to ensure greater security for the protocol’s code.

However please note that Audits are not a 100% guarantee that all bugs will be found. There is a slight chance that bugs or vulnerabilities may be discovered even post-audit. So please exercise caution when interacting with any smart-contract.

Exclusive Beta Program for MAHA holders — Accepting Applications now

We are very excited to roll out the official Beta Program for the $ARTH valuecoin with the updated Seignorage Share model. The Beta round will be conducted in the coming days.

Previously the MahaDAO team had conducted the Alpha program for ARTH platform and it was a resounding success with over 50 shortlisted & dedicated testers giving highly valuable feedback and using the ARTH platform.

For this launch and beta program, we are accepting even more applicants & participants trailblazing through the ARTH platform looking to give their valuable feedback.

Hence prior to the main net launch, there will be a 3-day beta program given exclusive to MAHA token holders who hold at least 100 MAHA tokens.

All testers will receive rewards in $MAHA tokens at the current market price. A full breakdown of rewards will be shared with the community soon. Followed by a full guide for all testers.

We are accepting applications. If you would like to participate in the testing round, please fill out this form — https://forms.gle/gjRQzid7yf2nL17MA

The deadline for submitting your applications is 8th Jan 2021 3 PM GMT.

Looking Forwards

ARTH itself will undergo many more iterations from its current model however we are super excited to get started for the product release. In future articles, we will detail more about how newly minted ARTH will be distributed and how the remainder of the system will work.

We are grateful to the work done by the original Basis team, the ESD/DSD Community, the Basis Cash team (DefiRick and DefiMorty), and others who have contributed to the space.

MahaDAO believes that this is the start of the valuecoin revolution and we’re delighted to have you all along with us on this journey.]

About MahaDAO

MahaDAO is a community-focused decentralized autonomous organization that is on an explorative journey to create the world’s first valuecoin, ARTH.

MahaDAO Official Links

Note: There are many fake Telegram groups doing the rounds on Telegram. The only official MahaDAO Telegram group is this — http://t.me/MahaDao. Stay Safe.