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Design Overview

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Product Design Overview

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πŸ’‘Β Overall Product Design of Standard Protocol, more details on Whitepaperβ†’ | Product Philosophyβ†’

Problems

Standard Protocol wants to solve the following issues of the existing Stablecoin mechanism.

  1. Lack of interoperability with excessive focus on price stability.
  2. Absence of dedicated incentivized oracle system.
  3. Hard-To-Enter, Hard-To-Track Liquidation Auction Systems creating plutocracy in the ecosystem

Our Co-founder, Kang, decided to define the new standard for digital assets by leveraging technology with the Standard Protocol team.

Product Vision

Standard Protocol’s vision is to be the CeDeFi multichain protocol that utilizes technology to create borderless financial opportunities for everyone through full transparency and stability. By working across blockchain as a form of smart contract in each network, the Standard Protocol ecosystem strives for interoperability and represents a CeDeFi blockchain hub.

Protocol Design and Components

The design of the collateralized stablecoin tackles existing issues in three main directions:

  1. Rebasable elastic supply of stablecoin (USM) for price stability.
  2. Dedicated, incentivized and decentralized oracle ecosystem for punctual and accurate price feeds to support all activities within the protocol.
  3. Market efficient liquidation system achieved by depositing liquidated collateral to the USM-AMM pair instead of an auction system, opening arbitrage opportunities to any USM holder.

Three Token Module

  • Meter (USM) - Stablecoin

Meter (USM) is the stablecoin that is minted from user-posted collaterals. The elastic supply of USM is rebased each era to ensure the stability of its peg. Holders can use USM to leverage trade, exchange for other assets, and make arbitrage profits from liquidated collaterals.

  • Liter (LTR) - Liquidity Token

Liter (LTR) is the liquidity provider token that represents a share of the AMM Module. Similar to the LP token in Uniswap, LTR can be burned in an AMM to receive deposited assets. LTR can also be used for STND yield farming.

  • Standard (STND) - Governance Token

Standard (STND) is the network and governance token for Standard Protocol. Stability Fee generated from lending out USM will be distributed among STND holders.

More details on

Oracle

Standard Protocol builds a decentralized oracle system to guarantee delivery of punctual and accurate price feeds for all activities within the protocol. Without correct price feeds, the protocol will collapse. To maximize our reliability, we are building a dedicated incentivized oracle system.

Substrate enables developers to split block rewards to other network participants in every era. Block rewards to oracle providers maintain an 8:2 ratio between validators and the providers in an era. The total block reward in each era is 10% (governance controlled) of the total transaction fee to mint USM converted to STND. The decentralized and incentivized design will enable the protocol to provide efficient oracle data to maintain information integrity for our collaterals.

DEX

Our DEX, Standard Protocol engine of Stablecoin, covers Vault to mint USM through collateralized assets, AMM, and LP farming. Our design on collateral liquidation will provide a more fair, transparent, and market-efficient way to sustain the stability of our stablecoin MeterUSD ($USM). Read more on