(DOMANI is an oracle-less Digital Asset Management platform that enables users to create, mint and manage ETF-style tokenized funds. The views expressed in the article below should not be taken as investment advice. Always do your own research.) The recent LUNA-UST crash, which caused the price of UST to fall over 98%, has brought to light some fair criticisms of algorithmic stablecoins, and has also caused people to be more cautious of what stablecoins they are using as an on-chain reserve currency. One of the few positives to be taken out of this situation, is that it has taught investors that not all stablecoins are built the same, different stablecoins have differing levels of collateralization and centralization, which give them inherently different risk profiles. In this article we will look at the different types of stablecoins that exist, how their risks differ, and finally the DAO will propose the creation of XAVSTABLE, a tokenized fund composed of different stablecoins to mitigate individual stablecoin-depegging risk.
DOMANI – Stablecoin Risk Management
DOMANI – Stablecoin Risk Management
DOMANI – Stablecoin Risk Management
(DOMANI is an oracle-less Digital Asset Management platform that enables users to create, mint and manage ETF-style tokenized funds. The views expressed in the article below should not be taken as investment advice. Always do your own research.) The recent LUNA-UST crash, which caused the price of UST to fall over 98%, has brought to light some fair criticisms of algorithmic stablecoins, and has also caused people to be more cautious of what stablecoins they are using as an on-chain reserve currency. One of the few positives to be taken out of this situation, is that it has taught investors that not all stablecoins are built the same, different stablecoins have differing levels of collateralization and centralization, which give them inherently different risk profiles. In this article we will look at the different types of stablecoins that exist, how their risks differ, and finally the DAO will propose the creation of XAVSTABLE, a tokenized fund composed of different stablecoins to mitigate individual stablecoin-depegging risk.