Create a stable coin backed by LST yields

Sanctum Products
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Centrally backed stablecoins USDC and USDT makes up majority of crypto transactions. Attempts to create a decentralised stablecoin have been met with sustainability challenges and low adoption rates. The most successful decentralised stablecoin is USDS formally DAI.

USDS is a collateralise stablecoin. The issue with collateralise stablecoin is when the price of the assets depreciate the stablecoin can lose its fiat peg. To maintain the peg, complex mechanisms are developed. Example USDH.

Solana lacks a successfully decentralised stablecoin. LST yields offer a sustainable way to create a stablecoin backed by value.

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Interesting take usdcloud

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Interesting take.
Curious how that would look like in terms of sustainability.

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Reminds me of Luna and usually doesn’t end well with Crypto volatility

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Luna was a Ponzi. This would be backed by the economic activities on Solana.

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Doesn’t matter. Economic activities and prices come down. Luna backed it with Btc too other than their token.Has been done and failed unfortunately

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I have added some points here

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If Sanctum adds support for stablecoins (which I think is super important for the future of Solana) then I think it would be best to work with a decentralized issuer like Paxos. USDG has their hq in Singapore and fees are distributed among network participants in a manner that is both fair and transparent.

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Eno is going to love where this is going xD

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