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Topic: Stable coin without algorithm or backing - page 2. (Read 249 times)

full member
Activity: 2590
Merit: 228
How do you think would the the price in USD of such stablecoin always stay close to 1.00?
I hope I understand your question properly.

Stablecoins are backed by collateral assets that are usually controlled to help manage the price of the stablecoin itself. Any entity or organization that holds these stablecoins (if it is a centralized platform) or those who hold the collateral that is used to back up stablecoins usually try to control the supply and demand so the price stays as close to $1 at all times.
legendary
Activity: 1820
Merit: 2700
Crypto Swap Exchange
How do you think would the the price in USD of such stablecoin always stay close to 1.00?

So your contract can only issue new tokens, without the ability to take them back?  In this case, the value of such a token would likely be worthless.
newbie
Activity: 29
Merit: 2
Lets assume we have a ETH smart contract

It watches at  ETH/USD pair using some oracle like Chainlink

Now, some user sends some amount of ETH to this contract
The contact takes a current value of ETH/USD , for example 3500 and credits the user with exactly 3500 tokens and also burns received ETH

This way our user receives  amount of tokens which  exactly equals to amount of USD he spent

Though, the total amount of USD spent will not be equal to the total amount of tokens emitted - but nobody can say the exact ratio

How do you think would the the price in USD of such stablecoin always stay close to 1.00?
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