1/ Platypus finance just published their stablecoin $USP design.
Here's how it works 👇
Here's how it works 👇
2/ Platypus is an AMM for pegged assets on Avalanche.
Similarly to Curve, users on Platypus can swap among various stablecoins with low slippage.
Its main difference from Curve is single-sided liquidity provision to an open liquidity pool, which avoids liquidity fragmentation.
Similarly to Curve, users on Platypus can swap among various stablecoins with low slippage.
Its main difference from Curve is single-sided liquidity provision to an open liquidity pool, which avoids liquidity fragmentation.
3/ The key to Platypus (and other AMMs) is attracting liquidity and increasing capital efficiency.
Curve and Platypus attract liquidity with token rewards, but it's an expensive short term solution.
So launching a native stablecoin is seen as a long term solution.
Curve and Platypus attract liquidity with token rewards, but it's an expensive short term solution.
So launching a native stablecoin is seen as a long term solution.
4/ USP mechanism is inspired by MakerDAO's DAI.
USP is an overcollateralized stablecoin minted with Platypus' own LP tokens.
A key to understand is: due to Platypus single-sided liquidity model, LP token represents only one underlying token.
USP is an overcollateralized stablecoin minted with Platypus' own LP tokens.
A key to understand is: due to Platypus single-sided liquidity model, LP token represents only one underlying token.
5/ The lower the risk of the underlying token, the higher the Collateral Factor (CF) for minting USP.
The initial Collateral Factor for stablecoins will be 80% and lower for other assets.
Underlying token price for collateral will be fetched from Chainlink.
The initial Collateral Factor for stablecoins will be 80% and lower for other assets.
Underlying token price for collateral will be fetched from Chainlink.
6/ Similarly to Dai, USP has a borrow fee (initially set to 0%) and a stability fee (interest rate).
This stability fee will depend on USP price on Platypus stableswap.
After the launch, USP will be listed on Platypus alongside other stablecoins.
This stability fee will depend on USP price on Platypus stableswap.
After the launch, USP will be listed on Platypus alongside other stablecoins.
7/ If people sell USP and price drops below $1, then borrowing USP will get more expensive (stability fee goes up).
Borrowers need to buy USP to repay expensive loan, which should drive the price of USP back to $1 USD.
If price is above $1, borrowing USP gets cheaper.
Borrowers need to buy USP to repay expensive loan, which should drive the price of USP back to $1 USD.
If price is above $1, borrowing USP gets cheaper.
8/ It seems there'll be PTP emission rewards to mint & deposit USP.
The team also announced they'd use a portion of revenue in non-USP stablecoins to mint USP and supply to the main pool.
This protocol-owned position will not be withdrawn and will serve as initial liquidity.
The team also announced they'd use a portion of revenue in non-USP stablecoins to mint USP and supply to the main pool.
This protocol-owned position will not be withdrawn and will serve as initial liquidity.
9/ Other note-worthy features:
• USP system will halt new borrows if a stablecoin-collateral price drops by 2% .
• Platypus will support USP flash loans for a 0.09% fee.
I'm most curious about Automated market operations though.
Not sure if @Platypusdefi will support it?
• USP system will halt new borrows if a stablecoin-collateral price drops by 2% .
• Platypus will support USP flash loans for a 0.09% fee.
I'm most curious about Automated market operations though.
Not sure if @Platypusdefi will support it?
10/ Platypus' USP is another entry to the Protocol-Owned-Stablecoin trend.
Curve's crvUSD, Aave's GHO, Ampleforth's SPOT...
More protocols are opting to issue a native stablecoin to attract TVL and increase revenue.
Soon we'll have Curve pools with these stablecoins 👀
Curve's crvUSD, Aave's GHO, Ampleforth's SPOT...
More protocols are opting to issue a native stablecoin to attract TVL and increase revenue.
Soon we'll have Curve pools with these stablecoins 👀
11/ Did I miss something important?
Follow me @DefiIgnas for more.
Like/Retweet the first tweet below if you can
Follow me @DefiIgnas for more.
Like/Retweet the first tweet below if you can
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