StableUSD is a reserve-backed ERC-20 stablecoin that will be issued by Stably, in exchange for USD or ETH. Stably will utilize a centralized model to fully back every StableUSD token issued with an equivalent unit of real currency (e.g. US dollar) in a transparent reserve. In addition to regular third-party audits, token issuance/repurchase transactions are recorded on-chain and all off-chain transactions as well as reserve balances will be broadcasted to the public at frequent intervals. For more info, please visit: www.stably.io
How is StableUSD different from Tether?
Tether is not transparent with their reserve management. They have not been properly audited and there is no evidence that they indeed have ~$2.5-billion in reserve. At Stably, we will publish weekly attestations by a professional audit firm in order to show that the amount of USD held in escrow accounts by our fiduciary custodians is equal to the amount of USDS tokens in circulation. Live feeds to the escrow accounts’ balances will also be provided via our custodians’ APIs.These efforts will ensure that all funds are secure and present which will help us create a more transparent and reliable USD-backed stablecoin.
How do I purchase StableUSD?
First, check to see if Stably operates in your country of residence. If not, you will need to wait until we support StableUSD in your jurisdiction.
If you are a resident of a supported country, purchasing newly minted StableUSD tokens will require you to create an account with us at www.stably.io. You will need to provide information for KYC/AML purposes before we can verify your account.
- Once you have created an account with Stably, you must submit your personal and financial information, including your bank account information and a valid Ethereum ERC-20 wallet address that the USDS tokens will be sent to after being purchased.
- Afterward, you can create a USDS token purchase/issuance request on our platform. We then forward this information and the request to our custodian. The custodian will then screen your information in accordance with their internal anti-money laundering and know your customer compliance program (“AML/KYC”).
- Upon approval of the request, the custodian will notify us and we will notify you to initiate the USD wire or ACH deposit to the escrow accounts held by our custodian.
- Upon receipt of funds, the custodian will signal our smart contract to mint USDS tokens and send them to your wallet address.
Additionally, we are working on getting StableUSD trading pairs listed on major cryptocurrency exchanges against BTC, ETH, USDT and USD. Once listed, you may also purchase StableUSD tokens on these exchanges if you have a verified account with them.
How do I redeem my StableUSD tokens?
If you have a KYC/AML verified account with Stably, you can:
- With an AML/KYC-verified Stably account, you can then create a redemption request on our platform. We will then forward the request to our custodian.
- Upon approval of the request, the custodian will notify us and we will notify you to send your USDS tokens to a deposit address to be burned.
- Upon receipt of tokens, we will notify our custodian to initiate the USD wire or ACH transfer to your bank account.
How much does it cost to use StableUSD?
USDS tokens can be issued and redeemed at no cost (excluding third-party transit costs such as Ethereum network transaction fees and bank wire/ACH fees). Stably itself will not charge any fee to issue/redeem USDS tokens.
How will StableUSD stay stable?
Any price discrepancy between USDS and USD presents an arbitrage opportunity for market participants. Since USDS tokens are fully backed and redeemable for USD at a 1-to-1 ratio via the Stably Platform, there will always be an incentive for traders to “arb” away the pricing discrepancies as soon as they appear, causing StableUSD’s market price to stay pegged at or very close to $1 USD at all times.
How can I confirm that my StableUSD tokens are backed and secure?
We will publish weekly attestations by a professional audit firm in order to show that the amount of USD held in escrow accounts by our fiduciary Custodians is equal to the amount of USDS tokens in circulation. Live feeds to the escrow accounts’ balances will also be provided via our Custodians’ APIs.
Why should I use StableUSD instead of a decentralized model?
We believe in the evolving decentralized ecosystem, but the infrastructure will take time to develop. We can bootstrap the new token economy with existing financial infrastructure to provide for use cases that make sense today.
What other assets will Stably support?
As of right now just USD, however, in the future Stably plans on expanding to other fiat currencies such as the Euro, Yen, and Pound. Like StableUSD, these will be fiat-collateralized stablecoins as well (e.g. StableEUR, StableJPY, StableGBP).
Is StableUSD a security?
Our current legal counsel has provided us with the opinion that USDS tokens are unlikely to be considered securities. A USDS token maintains the same value of $1 over time and has no inherent expectation of profit that is a direct result from Stably’s management efforts. USDS tokens are more similar to deposit and safekeeping receipts, which the SEC has previously analyzed and recommended no enforcement actions for their use (see 40 Fed. Reg. 1695 et. seq).
Who are your Custodians and Auditors?
We are currently in active discussion to integrate with multiple third party custodians and auditors in order to expand StableUSD’s network and reach. As of October 2018, we are officially partnered with Prime Trust as our Custodian and Cohen & Company as our Auditor.
Blockchain: A growing list of records, called blocks, which are linked using cryptography. Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data. By design, a blockchain is resistant to modification of the data.
Cryptocurrencies: Digital assets that enable decentralized applications through incentivization. For more information on how this works, you can read this Coinbase article.
Smart Contract: A computer protocol intended to digitally facilitate, verify, or enforce the negotiation or performance of a contract. Smart contracts allow the performance of credible transactions without third parties. These transactions are trackable and irreversible.
Decentralized Application (Dapp): A networked software application in which multiple untrusting parties can achieve consensus on the state of the system without the need of any trusted centralized party.
Distributed Ledger Technology (DLT): The software protocol layer upon which decentralized applications can run. The defining feature is a shared, immutable ledger of transactions that multiple parties come to consensus on via cryptography-based algorithms. DLTs that are fully public are also referred to as “blockchains.”
Stablecoin: A cryptocurrency or token that maintains price stability relative to major global fiat currencies, including the USD and the EUR. There are three types of stablecoins: fiat-collateralized, crypto-collateralized, and uncollateralized.
- Fiat-collateralized: Stablecoins backed by fiat (sometimes called ‘real’) currency. Every stablecoin (or token) is backed by a unit of currency, typically the U.S. dollar, in a reserve. The stablecoin may or may not be redeemable for the underlying currency. Examples: StableUSD, Tether, TrueUSD.
- Crypto-collateralized: Stablecoins backed by cryptocurrency (such as Ether, Bitcoin, etc.). The stablecoin is issued against the collateralized cryptocurrency. Since cryptocurrency is volatile, the stablecoin is over-collateralized. This means, for example, that it takes $200 of cryptocurrency to issue 100, $1 stablecoins. Example: MakerDAO, BitUSD, Havven.
- Uncollateralized/Algorithmic: Stablecoins not backed by anything. These stablecoins attempt to maintain price by algorithmically controlling the token supply with a smart contract. Examples: Basis, KowalaUSD, CarbonUSD.
Token: A re-document of some asset or unit of account that resides on top of an existing blockchain. Relies on the underlying blockchain to function but serves no native purpose in the blockchain network.