Duo Nine | YCC Profile picture
Apr 25 β€’ 16 tweets β€’ 8 min read
1/ The #NEAR Protocol stablecoin is out: #USN

1 USN is always backed at 100% by NEAR + stables in the Reserve Fund.

You can mint 1 USN against $1 of NEAR & earn at least 10% APY (Reserve Fund yield).

How does it work and is it superior to #Luna/#UST?

YES.

Why? A thread πŸ‘‡ Image
2/ What is $USN?

A fully collateralized, algorithmic NEAR-native stablecoin pegged to the US dollar.

It uses on-chain smart contract for NEAR/USN arbitrage like UST and StableSwap pool with other stablecoins (swap USDT for USN).

How does it match against other stables? πŸ‘‡ Image
3/ There are 4 types of stables:

1. Backed by the actual US dollar: #USDT, #USDC = centralized
2. Backed and collateralized by crypto: #DAI = capital inefficient
3. Semi-algorithmic: #FRAX = low adoption
4. Fully algorithmic: #UST = on-chain peg stabilization

USN? πŸ‘‡
4/ USN uses an on-chain smart contract to issue USN and maintain its peg similar to how UST / Luna works:

1. You exchange NEAR to get USN.
2. You exchange USN to get NEAR.

But there is a catch here which makes USN better than Luna / UST and DAI! πŸ‘‡ Image
5/ NEAR is NOT burned to issue USN (compared to Luna), instead, it is placed in the Reserve Fund to 100% back all USN in circulation including with other stables + generate yield!

USN is also capital efficient compared to DAI + decentralized!

USN is fully backed, UST is NOT! πŸ‘‡ Image
6/ While USN / NEAR start as fully collateralized, UST is only now trying to build a reserve in BTC & other coins!

UST is issued on LEVERAGE, while USN is always BACKED!

The NEAR reserve can always buy back the entire issuance of USN!

Death spiral? πŸ‘‡

7/ The Reserve Fund (that includes USDT) is a buyer of last resort.

What will it buy? NEAR to ensure USN is BACKED at 100%.

UST does NOT have this feature built into its mechanism & the Terra reserve needs another $16 bil today to catch-up to UST market cap!

Is USN perfect? πŸ‘‡ Image
8/ No.

But at least USN is backed!

Even if NEAR price crashes, the Reserve Fund will have other stablecoins (USDT) to buy NEAR and ensure price does not crash below a certain threshold to put in danger the solvency of USN.

You cannot say that about UST!

USN adoption? πŸ‘‡
9/ USN will boost adoption by paying at least 10% APY to depositors based on the Reserve Fund yield (paid via NEAR stacking at ~10% APY, real yield could be higher).

This APY will likely sit at 10% as its market cap / depositors grow.

Is this yield better than UST? πŸ‘‡ Image
10/ Not in the near term.

But UST yield on Anchor will start falling as of May 1 from 20% to 18.5% and so on.

Considering UST is not backed, USN is a superior stablecoins with all the benefits!

Are there risks holding USN? πŸ‘‡ Image
11/ The biggest risk is smart contracts bugs, hacks and so on.

The peg will likely hold well, similar to UST.

If a bank run happens, USN is much better placed to hold its peg compared to UST that only has 10% backing!

Will NEAR pump? πŸ‘‡
12/ NEAR is not burned, but rather staked = the impact on NEAR price is still bullish as USN market cap grows.

However, NEAR's price can still crash if a lot of USN exits the ecosystem. Similar to UST / Luna.

But the USN Reserve Fund guarantees a floor price.

What more?πŸ‘‡
13/ I encourage you to read the white paper:

What to know more about stablecoins? πŸ‘‡

drive.google.com/file/d/1kYqdv3…
14/ Here's my stablecoin guide that can help you navigate this emerging market.

I also made a nice analysis between UST & DAI πŸ‘‡

15/ Why UST is committed to destroy DAI...

Now Terra has even more competition to worry about. πŸ‘‡

16/ If you liked this thread, #retweet the first post to get more of this content in the future! 😍

Stay in touch + follow @DU09BTC:

Discord: bit.ly/3n2gng0
TradingView: bit.ly/3FUjwHj
YouTube: bit.ly/3p8vPdf
Newsletter: bit.ly/3BuXf13

β€’ β€’ β€’

Missing some Tweet in this thread? You can try to force a refresh
γ€€

Keep Current with Duo Nine | YCC

Duo Nine | YCC Profile picture

Stay in touch and get notified when new unrolls are available from this author!

Read all threads

This Thread may be Removed Anytime!

PDF

Twitter may remove this content at anytime! Save it as PDF for later use!

Try unrolling a thread yourself!

how to unroll video
  1. Follow @ThreadReaderApp to mention us!

  2. From a Twitter thread mention us with a keyword "unroll"
@threadreaderapp unroll

Practice here first or read more on our help page!

More from @DU09BTC

May 30
1/ 🚨 Major breach of resistance by #Bitcoin! 🚨

If this has follow-through tomorrow, this will be a major breakout.

Altcoins are even more bullish.

How will I play this? πŸ‘‡

A short thread. 🧡 Image
2/ The best play right now is to ride this wave up and secure profit at the first sign of weakness on the daily timeframe.

I'd give this relief rally at least two weeks or max the month of June.

Then seriously consider taking profit & wait.

Why? πŸ‘‡ Image
3/ The macro remains bearish and #Bitcoin may test the 200 weekly moving average (the blue line in the previous tweet) before any serious reversal.

Does the monthly MACD look like we're going to reverse soon?

NOPE!

Wait in fiat & accumulate at & under the 200 MA.

Next πŸ‘‡ Image
Read 5 tweets
May 28
1/ #USDD is NOT a stablecoin! WHAT? 😲

Here's my review of the USDD cryptocurrency on #Tron network. #TRX

Read the above again. This is the label they used for USDD in their whitepaper!

A clear red flag & there are more.

You asked & I delivered. A thread. 🧡

πŸ‘‡πŸ‘‡πŸ‘‡
2/ What is #USDD?

USDD is a cryptocurrency native to #Tron network.

This is nothing big on its own.

However, if you thought USDD was a regular stablecoin, I got a surprise for you. πŸ‘‡
3/ Check out this abstract from the USDD whitepaper.

Highlights are mine.

Let me dissect that for you in more detail below.

There is a reason the whitepaper is so... vague.

It's pretty obvious what's going on. πŸ‘‡
Read 20 tweets
May 19
1/ On March 28 I made a thread on the top 10 reasons why we are in a bear market using stablecoin charts.

The only divergent signals (opposing this view) were from #UST & #USDT.

What happened since?

#UST went to 0 & #USDT lost $9 bil in mcap.

Next πŸ‘‡

2/ All reputable stablecoin mcaps were falling (#USDC, #DAI, #LUSD), except UST and USDT.

USDT has now corrected this divergence and is falling in the trend (pic).

UST was not so fortunate and crashed to 0 with more algo stables following the same trend: #USDN, #DEI.

Next πŸ‘‡
3/ UST did not have the backing to account for its mcap, hence it went to 0.

Why so bad? Because of a death spiral:

Buy 1 UST, burn it for Luna, sell Luna for $1. With $18 bil UST to burn for Luna, this crashed Luna's price to 0 and UST followed soon after.

Next πŸ‘‡
Read 9 tweets
May 9
There is $100 mil in Curve left to exit from UST.

Binance bids at $0.98 are being replenished with $10-20 mil every few min.

So far their defense looks solid.

Unlikely Do Kwon pockets can absorb hundreds of millions of sales per hour.

That is money he is losing/hour.
Ok, they ran out of money already, lol.
They refilled it. I suspect they may start selling Luna if they run out of cash... Luna is under $50 already... wtf.
Read 4 tweets
May 9
1/ Time to dispel the myths around #Terra / #Luna / #UST once & for all!

Is it decentralized? Is UST a stablecoin? Is it #SAFU?

What are the alternatives???

Are you with me?

Here's the thread you've been waiting for. πŸ‘‡
2/ Before I debunk the most important myths about Terra, I suggest you check my earlier thread on this to understand the context better.

Ready? Let's start with myth number 1. πŸ‘‡

3/ Myth number 1:

🚨 "Terra / Luna / UST is decentralized."

Verdict: FALSE ❌

I can explain, lets's look at the Terra / Luna network first and then UST. πŸ‘‡
Read 21 tweets
Apr 18
1/ You no longer have to trust anon FUD on Twitter about #UST

You can now trust the well respected Wall Street Journal @WSJ

Here are the key points in their article that should raise your eyebrows. πŸ‘€

UST is on a thin line as its founder fights the SEC in court.

A thread πŸ‘‡
2/ Exhibit 1:

"A new breed of cryptocurrencies is seeking to replicate the stability of the dollar. But critics say they are a disaster waiting to happen."

They mean #UST and DAI+BUSD/Paxos fudding UST.

Next πŸ‘‡
3/ Exhibit 2:

"...algorithmic stablecoins aren’t necessarily backed by any assets at all. Instead they rely on financial engineering to maintain their link to the dollar. Some have failed, saddling investors with losses."

Is UST backed? Nope.

Next πŸ‘‡
Read 16 tweets

Did Thread Reader help you today?

Support us! We are indie developers!


This site is made by just two indie developers on a laptop doing marketing, support and development! Read more about the story.

Become a Premium Member ($3/month or $30/year) and get exclusive features!

Become Premium

Don't want to be a Premium member but still want to support us?

Make a small donation by buying us coffee ($5) or help with server cost ($10)

Donate via Paypal

Or Donate anonymously using crypto!

Ethereum

0xfe58350B80634f60Fa6Dc149a72b4DFbc17D341E copy

Bitcoin

3ATGMxNzCUFzxpMCHL5sWSt4DVtS8UqXpi copy

Thank you for your support!

Follow Us on Twitter!

:(