Been working on a bankless Hong Kong Dollar, built on Ethereum: HKDai.
It's the first time I build a dapp end-to-end, so here's a thread with some thoughts + current status.
What is HKDai?
HKDai is a cryptocurrency which - similarly to the Hong Kong Dollar (HKD) - is soft-pegged to the US Dollar (USD) at a rate of 7.8 HKDai to 1 USD.
While the HKD is pegged by the Hong Kong Monetary Authority (HKMA) intervening in markets at certain price points (sell HKD at HK$7.75; buy HKD at HK$7.85), HKDai is 100% collateralized by Dai.
You can margin-trade DAI/USDC when the peg strays from $1, in case you're not aware!
Example using @compoundfinance : 1. You have $1,000 $USDC on Coinbase 2. Buy $DAI @ $0.99 (incl. fees) => You now have $1,010.10 DAI 3. Lock your DAI into @compoundfinance
(thread)
4. Receive $68.69 in yearly *supply* interests (current rate) 5. Borrow 50% of your supplied DAI in USDC, i.e. $505.05 6. Pay $63.79 in yearly *borrow* interests (again current rate)
7. Buy more DAI @ $0.99 for your borrowed USDC => You now have $510.15 more DAI 8. Lock your new $510.15 DAI up in @compoundfinance for an additional $34.69 in yearly supply interests 9. You're now net positive on your interests: $39.59/year, or 3.96% on your initial capital