What are the three mechanisms for stabilizing currency USDN? What’s the use?
For a stablecoin issued based on NGK network, the NGK team aims to carry out the decentralization characteristic of blockchain in depth, and empowers USDN three mechanisms to ensure that the price of the USDN is not affected by the market and fluctuates. Today, I will explain in depth how the USDN three mechanisms help USDN become a real stablecoin.
USDN active currency
The mechanism of USDN currency is relatively simple, that is, to make USDN a digital currency that anyone or institution can trade freely, USDN is not much different from other stable currencies, but with the help of a wide range of ecological partners in the NGK network, USDN has more applications than other stablecoin projects, including the use or future use of physical products in digital shopping malls based on NGK networks.
USDN bond voucher
USDN bond vouchers are the first step in ensuring that USDN prices in dollars remain unchanged. When the USDN price is higher than $1, the system will issue USDN, to bondholders to increase the supply of stable currency and reduce the price smoothly to about $1. When the price of a stablecoin is less than $1, the USDN system will issue new bonds and buy them back from the market USDN, reduce the total amount of USDN in circulation, and the price of the USDN will rise to about $1.
USDN equity index
USDN equity index is the second line of defense USDN meet the demand for additional issuance. When USDN bond voucher has paid all the bond vouchers in the market, it still needs to be issued, and the system will distribute the USDN tokens used to adjust the supply and demand of USDN tokens to the owners of the equity index. In terms of distribution, the distribution will be based on the proportion of the user or institution holding equity index.
NGK team has given USDN three mechanisms of smart contract to solve the problem of stablecoin in the market by adjusting the route of supply and demand. Will such a solution work? Let’s look forward together.
