Algorithmic Stablecoin Initiative Neutrino Rolled Out Staking Dedicated to Its Governance Token

By Tracy Hannes | December 20, 2020

The Neutrino Protocol – an initiative designing algorithmic cross-platform stablecoins – reportedly disclosed details of its staking rewards release for its governance and utility token, the Neutrino System Base Token (NSBT).

Specifically, Neutrino will utilize a wide range of innovative collateral backing and algorithmic supply changes, in a bid to form numerous stablecoins pegged to the fiat currency. 

Its flagship stablecoin, USDN, and NSBT, will reportedly be tradable across Ethereum in the form of ERC-20 tokens. 

The USDN generation mechanism reportedly depends on WAVES – the native token of the Waves platform. The stablecoin issuance process will be simply similar to carrying out smart contract-enabled exchanges between WAVES for USDN. Oracles will record the asset’s price and generate the USDN sum from the existing WAVES’s price. 

The asset will then consolidate a collateral pool to serve as the USDN stablecoin support. The reverse protocol can be conducted freely, WAVES to USDN redeeming, per the price market recorded as of the time. 

However, the condition for this mechanism to satisfy required validity is when WAVES’ price is on the rise, or maintained in a stable manner. Should the amount decline, the stablecoin’s reserves would fall below the number of tokens in circulation. 

To enable system recapitalization, smart contracts will auction off new NSBT in return for WAVES, with features bearing resemblance to  the “flop” auction, employed by MakerDAO in post-Black Thursday time. 

As soon as the WAVES recovery is completed, or system recapitalization is done,  the NSBT will be redeemable for USDN at a rate, determined by the stablecoin’s reserves ratio.

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