GIP 2.5: The GCDollar Genesis Proposal

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.

Collaterals:

  • 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

Parameters:

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.

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Hi, community! I have a proposal for it. I would like to replace WBTC on RenBTC. There are several reasons. The First: there is a specific company behind WBTC. It means regulators can pressure it. The second RenBTC has a more decentralized network of validators.

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Agree with you! What if team will reduce limits for WBTC and XAUT and share those limits with renBTC and Pax Gold?

Like right now 7 mill GCD is proposed for WBTC, the team is able to release next collaterals with 3 mln for wbtc and 4 for renBTC

What do you think?

If I am not mistaken you suggest keeping WBTC and renBTC both in the basket of assets?

Yes, just reduce limits later for WBTC to decrease risk you mentioned.

Hmm. I think it’s the good idea.

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