An audit of the collateralized stablecoin GCD’s protocol, implemented on Unit Protocol, will be completed shortly.
By the time of mainnet launch, these parameters are proposed for approval by the community:
- A list of initial collateral assets
- Vault parameters
- A target borrowable GCD amount for each vault
These parameters can be changed in the future under a new proposal.
GTON Dollar is a collateralized stablecoin pegged to the US dollar in a 1:1 ratio. The same design and principles are used by DAI, sUSD, LUSD, MIM, USDP and other stablecoins.
- The initial target for GCD issuance is proposed to be 28 mln.
- Four collateral assets are proposed for vaults, with an equal borrowable limit of 7 mln GCD for each:
- GTON - the main utility token of the GTON ecosystem
- ETH - the main utility token of Ethereum (wETH, an ERC20 wrapped version)
- WBTC - an ERC20 wrapped version of the main cryptocurrency
- XAUT- the main and most liquid stablecoin pegged to gold
Each vault is to have 6 parameters:
- Borrowable GCD Limit is the amount of the stablecoin to be issued using collateral
- ICR (Initial Collateral Ratio) reflects how many GCD are available for borrowing with this token. For instance, if ICR is 40%, a user who deposits $1,000 can borrow up to $400 GCD. We can also call it the “inverse” collateral ratio.
- LR (Liquidation Ratio) is a debt/collateral ratio that represents the limit after which CDP can be liquidated by anyone. For example, an LR of 50% means that if the debt/collateral ratio is >50%, the position can be triggered for liquidation. LR has to be higher than ICR to create a safety reserve for avoiding fast liquidation.
- Stability Fee shows how much the borrowing of GCD will cost you per year.
- Liquidation Fee reflects the percentage of your collateral that you stand to lose if it gets liquidated.
- Issuance Fee is a percentage charged for issuing GCD each time. For example, if the issuance fee is 0.9% and you want to get 10 GCD, you will have to issue (10 / 0.991) GCD.
For all 4 Genisis Vaults we propose the same values for Limits and Stability/Liquidation/Issuance Fees: limits of 7 mln GCD per vault and all fees at 0.3%.
The collateralization and liquidation parameters will vary from vault to vault, based on volatility, liquidity and correlation:
- GTON - ICR 40%, LR 50%
- ETH - 70%, LR 72%
- WBTC - 70%, LR 72%
- XAUT - ICR 70%, LR 80%
At a later point, we will propose to expand the list of collateral coins to include, specifically, LINK, BNB, MATIC, AVAX, ERG and FTM.