USD Tez — FAQ (and Fact Sheet)

Frequently asked questions about USD Tez and Official Facts

Kevin Mehrabi
Aug 10, 2019 · 4 min read

Last updated: January 11th, 2020.

What is USD Tez?

USD Tez (Symbol USDtz ) is a Tezos on-chain stablecoin pegged to the value of the United States Dollar and built to Tezos FA-1.2 digital asset token standard.

What are the underlying values of the USD Tez project?

  1. On-chain liquidity is one of the most critical resources needed to enable a decentralized finance future.
  2. Tezos is the ideal platform for decentralized finance (DeFi), beyond any other blockchain protocol (past, present, or even those in planning) and will logically triumph as central to the future of DeFi.

Which FIAT currency does USD Tez seek to price-match?

Each USDtez is priced to match the United States Dollar. 1 USDtz token must meet the same value of 1 USD.

To what is USD Tez-pegged?

USD Tez’s-peg is in its name “USD” — in other words, the currency known throughout the world as the United States Dollar.

What determines the exchange rate of USDtz/XTZ?

The rate of exchange for the pairing USDtz-to-XTZ is set by price oracles which by median consensus determine the true exchange rate between XTZ and the US Dollar; a system of price indicators deriving real-world market data to algorithmically determine the precise fair-price of XTZ in terms of USD up to 1/100000th of one penny ($0.0000001).

Are there stability fees or equivalent in USD Tez?

No. There are no stability fees to owning FIAT, and there shouldn’t be any stability fees to own a stablecoin. There are no stability fees for USDTez.

How is USD Tez governed?

Initially, USDtez will be administered by the USD Tez Foundation which will be based in Switzerland. The USD Tez Foundation will oversee all administrative activities of the stablecoin as well as steward the creation of what will ultimately be a USD Tez DAO (Decentralized Autonomous Organization ) in which governance decisions regarding USD Tez will be made on-chain by the consensus of USD Tez community members, just as Tezos itself embraces through on-chain governance.

Over time an increasing number of USD Tez governance jurisdictions will be revolved permanently from the USD Tez Foundation to the USD Tez DAO, enabling more consensus-driven innovations as well as the immortality of the stablecoin.

Does USD Tez keep full-reserves?

Yes. In fact, USD Tez is a 4:1 over-collateralized reserve; 2:1 over-collateralization with FIAT and 2:1 over-collateralization with USD.

The first layer is the base layer, containing 1 FIAT USD silo and 1 XTZ silo. All USDtz in existence will be fully redeemable for the equivalent value in either denomination.

The other two silos compose the “growth layer” which effectively collateralizes the base layer. For example, if the price of XTZ goes down, the growth layer’s FIAT silo can ‘top-off’ the base layer’s XTZ silo with an XTZ purchase.

How can I learn more about the USD Tez Reserve model?

Read the USD Tez Collateral-squared article.

What else can I do with USD Tez?

USD Tez can be used for On-Chain Lending — the on-chain lending concept will be integrated into a lending platform called “Tezfin” Tezos.finance which will launch in 2020 as well.

USD Tez can also be used to purchase TZ-bills from the USD Tez Reserve, which are similar to T-bills in purpose but on-chain issued through Tezos blockchain-enforced smart-contracts. TZ-bills will be issued and auctioned at Tezos.bond, which will serve as the primary portal for updates and information on TZ-bills and other bond types to come.

Will other Stable-coins be issued by the creators?

USD Tez is part of the StableTez project, which will be issuing a suite of stable-coins, in the months and years to come. This includes what will launched next after USDtz, yet also early in 2020 — BTC Tez (BTCtz). Not all of the stable-coins to be issued by StableTez are necessarily for liquidity purposes. After all, the US-dollar and Bitcoin are the two most critical liquidity instruments in crypto-trading. Precious metal-pegged tokens such those Tezos Gold will be issued as well, along with agricultural commodities such as Tezos.Coffee and Tezos.Soy

How can I continue to follow the project?

Go to USDtz.com to sign up for the USD Tez mailing list. You can also follow us on various social media channels, including:

USD Tez (USDtz)

USDtz is a Tezos-based stablecoin pegged to the US dollar

Kevin Mehrabi

Written by

I have some thoughts. Founder/CEO, doing creative product things with #Tezos and #DeFi — oh and I like TV…a lot #Bahai #TzFi

USD Tez (USDtz)

USDtz is a Tezos-based stablecoin pegged to the US dollar

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