Decentralized USD
DUSD is a decentralized stablecoin native to DeFiChain. It is currently undercollateralized as the native DFI blockchain token was used to mint DUSD.
DUSD is a low-cap undercollateralized asset. This asset is exposed to the underlying risks of DeFiChain DEX, a protocol rated as Watch out.
DUSD is a stablecoin that often trades more than 100bps off its peg to USD, making it a highly volatile store of value.
DUSD has an uncapped supply but has inflation control or burn mechanisms in place. DUSD is exposed to death spiral risk as its price depends on another asset, thus creating negative feedback loops.
DUSD is a stablecoin that often trades more than 100bps off its peg to , making it a highly volatile store of value.
DeFiChain DEX
Who invented DUSD?
DUSD is the native stablecoin for the DeFiChain ecosystem. It was introduced by DeFiChain as part of its dTokens feature. Users can mint DUSD by first depositing collateral.
How does DUSD work?
DUSD was originally designed to be an overcollateralized stablecoin backed by its underlying assets. The collateralization ratio was set at 150%. The initial high demand for DUSD saw its price rise and stay consistently above 1 USD. This led to the introduction of an algorithmic mechanism to bring the price of DUSD back to peg. The mechanism was to burn the native blockchain token, DFI, to mint DUSD; this provided users an alternative way to create DUSD rather than buy it overpriced on an exchange.
What can you do with DUSD?
DUSD can be used as a medium of exchange or store of value on DeFiChain. It is also commonly used as the base pair for several liquidity pools on the DeFiChain DEX. If you wanted exposure to other dTokens, then you would need DUSD to swap for those assets.
