The dev team, supported by the Waves Labs incubator, is introducing a beta version of a new DeFi project that aims to mitigate the volatility of cryptocurrencies.
Neutrino is a cryptocurrency with a stable price, regulated by the Neutrino Protocol algorithm and backed by an underlying token and smart contract. In other words, it is a hybrid of a cryptocurrency-backed and an algorithmic stablecoin.
How does it work?
You send WAVES to the Neutrino smart contract, which generates an equivalent value of stablecoins. In the current version, a user can generate only dollar-denominated tokens — USD-N (USD-N = $1). The team plans to expand the options to gold, oil and S&P500-pegged tokens in the future.
All WAVES deposited as collateral are leased to a Neutrino node. The mining rewards are transferred back to the Neutrino smart contract and automatically converted to USD-N tokens. Thus, USD-N owners can not only hedge volatility risks, but also earn.
To ensure the value of USD-N remains completely stable, the Neutrino algorithm manages its price with a system of derivatives and payouts. Let’s consider two possible scenarios:
- WAVES price has fallen. An oracle ‘sees’ this and communicates it to a smart contract. The smart contract then issues and sells Neutrino bonds — USD-NB — on Waves.Exchange.
- WAVES price has risen. The smart contract liquidates USD-NB bonds purchased on the open market for 1 USD-N each. This profits bond buyers because USD-NB was issued at a price of less than 1 USD-N.
You can generate USD-N here. No registration or KYC is required.
You can read the White Paper here. All project updates will be displayed on social media:
Read Waves News channel
Follow Waves Twitter
Watch Waves Youtube
Subscribe to Waves Subreddit
Neutrino stablecoin launched for Waves ecosystem was originally published in Waves Platform on Medium, where people are continuing the conversation by highlighting and responding to this story.