What is USDV? The potential of omnichain stablecoin to VNST

2024-01-03

USDV is claimed to mark a major step forward in stablecoin technology, developed on the technology of LayerZero - one of the prominent projects in 2023, one of the largest multi-chain infrastructure protocols.

So let's find out what USDV is and the potential of this stablecoin.

What is USDV?

USDV, fully known as Verified USD, is native omnichain stablecoin anchored 1:1 with USD on LayerZero. USDV is integrated with LayerZero's Omnichain Fungible Tokens standard - allowing multi-chain operations across multiple blockchains. USDV was initially integrated on Ethereum, BNB Smartchain, Avalanche, Arbitrum and Optimism and has now added Polygon, Viction.

USDV is backed by a reserve of real-world assets tokenized into tokens (also known as Real-World Assets). This creates value for USDV and keeps it tied to the US dollar. In the future, USDV will expand support to include other highly secure RWAs in the underlying reserves

Organizations supporting USDV

23 organizations, also 23 "big names" in the blockchain industry, have initiated support for USDV. Among these organizations are Animoca Brands - a strong and long-standing crypto investment fund, Curve Finance - the leading defi protocol for stablecoins, Velodrome Finance - the leading defi protocol on Optimism regarding TVL with hundreds of millions of USD locked assets, Wintermute - leading investment fund and Market Maker or Stargate Finance - LayerZero's flagship product. There are also Bitget, Frax Finance, Maverick Protocol,... all of which have great influence in the crypto market.

Up to now, the total circulating supply of USDV is about 18 million USD, you can see detailed information here: https://usdv.money/transparency

Differences of USDV

Using the ColorTrace algorithm, USDV is the first stablecoin to reward Verified Minters based on their contribution to token circulation.

ColorTrace is a new value allocation algorithm from LayerZero Labs, to ensure fair and transparent reward distribution within its stablecoin ecosystem. This system allows Verified Minters to mark their circulating tokens and transparently access rewards from on-chain reserves.

Yield is proportionally shared between Verified Minters based on the circulation attribution calculated by ColorTrace

To explain in an easy-to-understand way, when Verified Miners use collateral to mint USDV, these USDV will be marked for Verified Minter with a separate "color". From there, Verified Minters will earn profits by maintaining the circulation of these tokens.

So what is maintaining circulation? That is, when a user interacts with stablecoins minted by Verified Minter, he or she will receive profits. This is aimed at enhancing the liquidity and utility of USDV.

  • Become a Minter: Partners can become a 'Verified Minter' with successful KYC, unlocking the right to mint USDV and access to real world yield.
  • Real World Yield Share: The fungible token coloring algorithm ColorTrace enables transparent & fair yield sharing based on USDV circulation contributed by each 'Verified Minter'.
  • Always native: ERC-20 compatible, USDV is built on the Omnichain Fungible Token (OFT) Standard, eliminating unofficial wrapped/bridged versions and liquidity fragmentation.
  • Next Level Transparency: Full transparency from real time on-chain transaction tracking, reserve proofing to daily real world asset monitoring.

Peg Stability Module

In the early stages of development USDV was designed with 100% of reserve assets being STBT (Short-term Treasury Bill Token). STBT is issued by Matrixdock - a digital asset platform that provides access to Real World Assets (RWA) through tokens and is fully owned by Matrixport.

Website: https://stbt.matrixdock.com/

Proof of Reserve: https://data.chain.link/ethereum/mainnet/reserves/stbt-

FAQ: https://matrixdock.gitbook.io/matrixdock-docs/v/english/

The total supply of USDV will always be adjusted to remain equal to the Net Asset Value (NAV) of the underlying portfolio on a daily basis. Meaning that if the total real-world assets of USDV are $1,000,000 then there will also be 1,000,000 USDV on the Blockchain. In the context of RWAs continuously increasing because those assets carry interest, the total supply of USDV is also flexibly adjusted.

From which, 1 USDV ~ 1 USD is guaranteed

Potential of USDV

USDV is blowing a breath of fresh air into the stablecoin world by bringing different "colors". In addition, being supported by many big names contributes significantly to helping USDV expand its market share as each of these organizations has a great influence on a large segment of users in the market. In the crypto world, it can be said that having users is everything.

With Verified Miners able to profit from circulation, USDV can be integrated and facilitated for development on products such as Bitget, Curve Finance, Stargate Finance which will help users access and use omnichain Stablecoins are easier.

The level of support for USDV is also a question mark, but at least being able to bring big names associated with it is sufficient to prove that USDV is really creating a potential product.

What if USDV is chosen as one of the collateral assets for VNST?

VNST is currently operating on the only blockchain, BNB Smart Chain, but in the near future it may move to other blockchains to support multi-chain users to reach more users.

The addition of USDV as the first collateral will provide more options for users in choosing collateral to mint VNST. In addition, users will have more convenience in interacting with VNST when they can use USDV to mint multi-chain VNST while still ensuring ownership of native tokens.

However, this is just a hypothesis, because as a project, VNST always strives to develop products and offer the most suitable features to benefit users, ensuring the first decentralized stablecoin pegged to VND is always convenient and safe.

Conclusion

USDV has only been launched for more than a month, so it is not yet possible to evaluate whether the stablecoin idea is suitable for market needs or not. However, based on current information, we can completely expect a bright future for USDV.

VNST, with the mission of providing safe, stable and convenient financial solutions for users, helping them easily participate in the financial technology market, will continue to contribute to the community to improve understanding of electricity money. electronics and blockchain technology.

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