Super proposal from telegram group to maintain peg

Discussions
1

Kas Sa, [11/05/2022 12:47]
If you really want to offset selling across the board you will need to have derivatives, like put options. You might waste some fees when things go well, but will be compensated in bad markets.

Universal Beats, [11/05/2022 12:54]
[In reply to Kas Sa]
That’s an AMAZING idea! :tada:

If the SC (or team) could hold put options on Waves the whole time BR isn’t massively overcollateralized (say 1.75x or lower for example), we could always stay fully backed whether Waves goes up, sideways, or even down 90%! Waves income from the Neutrino node can cover the fees for the put options!

This is an epic idea! @Sasha52653 thoughts??

Ali Kara :ocean: (1 ➝ 2), [11/05/2022 12:55]
It would be life saving If we had derivative market. Selling reserves in spot market makes things worse.

Universal Beats, [11/05/2022 12:56]
This could stabilize the entire system! Is it doable?

hawky, [11/05/2022 13:03]
[In reply to Universal Beats]
It is absolutely doable. I’ve written a whitepaper on a potential options implementation two years ago and even had example implementations for the necessary math (showing that it is possible in RIDE).

hawky, [11/05/2022 13:05]
And with new inventions in ride (e.g., fold functions) it should even be easier.

Universal Beats, [11/05/2022 13:06]
Wow. Seems like we could truly protect USDN’s backing ratio from depeg attacks and bear markets with this set up.

Universal Beats, [11/05/2022 13:07]
I wonder if the market depth is deep enough for large enough put options to fully protect the backing ratio

HERE THE PROPOSAL. I THINK IT DESERVE AN APPROPRIATE DISCUSSION SINCE CAN BE VERY IMPORTANT.

2

moss mann, [14/05/2022 16:06]
Gnsbt holder ought to be allowed to sell call options on their waves holding for usdn. This would help create a derivatives market that will stabilize volatility of usdn

3

Aren’t derivatives very risk on their own?

1 Like
4

The only good way out of this situation is to convert all existing USDN into WAVES at market prices and end the USDN project.

5

I don’t know why some tell useless to usdn. Is going to be the strongest stablecoin with plenty of recap mechanics. about vires problem, If you really hate this and want back centralized stablecoin (that is a risk because government can block instead of decentralized stablecoin) let’s sell and go back to usdc or usdt. The only thing to consider in that proposal is how much are the sum over 250 k, consider that for absurd all sell back to usdc usdt and see if the token surf of recap can resist a similar pressure. Because you haven’t yet connected derivatives to peg usdn even now there is tsunami so is possible to do (and I remind as for this discussion connecting derivatives would be even better that surf recap tool)