Waiting for $1000 WAVES is not a solution, nor is trying to artificially manipulate the market price or sentiment of USDN. The underlying flaws of Neutrino must be fixed.
Many users on the forum and on Telegram have offered solutions that would clearly be helpful. There are also some bad solutions involving stealing money that I will leave out. I will summarize the proposed ideas here so you can easily consider them once again. (I am not trying to take credit for all of these ideas.)
These solutions are independent of each other. Any or all of them could be used. Each is based on current mechanics.
1. Change how USDN works by making it independent of any backing. USDN would no longer be dependent on WAVES collateral. Instead, staked USDN would offer rewards and punishments incentivizing a stable price. For example, USDN would check the oracle price every block. If the price is at least $0.999, then all staked USDN generates a good yield. If the price dips below $0.999, then a small amount of USDN is globally burned and no yield is generated. The amount of yield would adjust automatically based on the extent of depeg. A major depeg would cause more burning but also temporarily offer even higher yields (paid only when it returns to $1) to encourage more people to buy it and return it to $1.
Benefit: changes the broken USDN model.
2. Change how USDN works by backing it with two complementary tokens. In the current design, the only possible end result was that eventually the WAVES collateral would be drained, because swaps are incentivized to go only one way (USDN to WAVES). It actually encourages depegging! Alternatively, USDN should be a 50:50 market-value balancer between two collateral tokens, so that if there is a shortage of one token, there is an incentive to deposit that token to restore the balance and receive extra USDN as profit, or to do the opposite and return USDN to the contract in exchange for whichever token is in excess. Mechanics would need to be adaptive, accepting only deposits at a certain threshold to prevent draining both tokens.
Benefit: changes the broken USDN model.
3. Stop spending 20000 WAVES per week on Curve tokens. It is not helping to balance the pool. There is only $17.4M USDN on Curve. The volume is extremely low. Those 20000 WAVES per week could be added as collateral instead.
Benefit: replenishes WAVES collateral.
4. Have no protocol fee to swap WAVES to USDN on Neutrino, just the standard transaction fee (0.005 WAVES). This would make it the cheapest way for gNSBT holders to sell WAVES (cheaper than selling on Waves Exchange) and helps push the price up instead of down. The downside is that it releases USDN, but it improves the BR by adding collateral.
Benefit: replenishes WAVES collateral.
5. Give a SURF bonus for WAVES-to-USDN swaps. The SURF bonus must be greater than the protocol fee to create enough incentive to do it. For example, with the protocol fee at 2%, a bonus of 3% in SURF would have to be offered. (User receives USDN as normal plus the bonus SURF.)
Benefit: replenishes WAVES collateral.
6. Increase the standard transaction fee from 0.005 WAVES to perhaps 0.01 WAVES, and send the extra 0.005 to the Neutrino smart contract as collateral. Essentially it would function as a tax. Alternatively, require USDN for transaction fees, and burn most of this USDN (by returning it to the smart contract).
Benefit: replenishes WAVES collateral or reduces circulating USDN.
7. Hold regular million-dollar USDN lotteries. 1 USDN buys 1 ticket. Users can buy any number of tickets. The contest runs when the number of entries reaches the desired amount (somewhere between 2-10 million USDN). The winner receives 1 million USDN. All of the remaining USDN is used to buy SURF and is distributed to the non-winners. Essentially it is an indirect way to convince them to buy SURF since they have a chance at $1M.
Benefit: reduces circulating USDN.
8. Gamification/competition to incentivize WAVES-to-SURF swaps. Hold a contest where a large prize is given to the wallet address that completes the most WAVES-to-SURF swaps in a given timeframe, like 90 days. Perhaps also give smaller runner-up prizes (that aren’t SURF) to keep interest up throughout the contest. Smaller users could pool together to compete against whales.
Benefit: replenishes WAVES collateral.
9. Disable trading pairs on Waves Exchange that do not contain WAVES or USDN. This is similar to how Binance requires trading in BUSD. It increases liquidity, and it would also aim to increase demand for WAVES and USDN. (An exception to this idea is the USDT/USDC pair, since Waves Exchange is marketed as the most cost-effective way to trade that highly desired pair and encourages deposits of those two coins.)
Benefit: increases demand for WAVES and USDN.
10. Require USDN to be converted into WAVES before it is exchanged for SURF. This idea requires a minimum peg level, like $0.97. Below that level, USDN could be swapped directly for SURF. But if the peg is close enough to $1, then route the USDN through Swop.fi to get WAVES, then exchange those WAVES for SURF. Increasing the WAVES collateral is better for the BR. There must be a strong emphasis on putting WAVES back into the smart contract so that the collateral isn’t depleted.
Benefit: replenishes WAVES collateral.
11. Backing from multiple tokens. This would make USDN more similar to DAI or USDD. Whether you like them or not, it’s a fact that both of those coins are successfully pegged to $1. USDD is backed by volatile assets TRX and BTC but also by stable assets USDT and USDC. Those stable assets guarantee that the collateral level cannot drop below 130%. If you have a problem with USDC in particular, don’t use USDC. The backing could be a group of WAVES tokens along with more stable assets such as USDT, TUSD, USDP, BUSD, and/or PAXG. Buy these instead of Curve tokens. People may bring up Terra/Luna in response to this, but there was no stable backing there, just like USDN has no stable backing. Just don’t let all the stables be withdrawn, so that there is a minimum BR always above 100%.
Benefit: replenishes collateral.
12. Use Sasha Ivanov’s Vires USDN to create a buying loop. You’re thinking that’s what got us into this mess, right? But it’s not the same, because there’s no borrowing. It’s just an attempt to pump the price of WAVES and replenish collateral to restore the BR. Use the USDN to market buy WAVES on Waves Exchange. Use Neutrino to swap those WAVES back to USDN (ideally the 2% swap fee would be reduced to near 0%). Use the USDN to buy WAVES again, but ideally WAVES would be a higher price at this point from the previous buying, and because some WAVES have been taken out of circulation and placed in collateral. Repeat and watch BR increase.
Benefit: replenishes collateral and pumps WAVES price (maybe).
13. “USDN is just wrapped WAVES.” Then let it become WAVES and end the problem of desperately trying to make USDN stay at $1 despite being unbacked. Convert all circulating USDN into WAVES at a fixed ratio, such as 4 USDN = 1 WAVES, like when a stock is split. Sasha Ivanov’s Vires USDN collateral would convert to WAVES, and he could be liquidated when the price of WAVES drops too low to maintain his account health. The price of WAVES could recover later by creating incentives to deflate/burn the circulating WAVES supply, such as through transaction fees. The Waves team would be able to focus on making WAVES a great/desired token with great tokenomics rather than spending day and night stressing about how to keep USDN at $1.
Benefit: ends the broken USDN model.