There can be many different types of Neutrino stablecoins depending on the asset it is pegged to, such as EUR-Neutrino, BTC-Neutrino, S&P 500-Neutrino, and more.
Neutrino USD (USDN) is an algorithmic stablecoin that is developed and collateralized by the Waves platform and pegged to the United States dollar.
USDN is one of eight Neutrino assets: Neutrino EUR (EURN), pegged to the Euro , Neutrino CNY (CNYN), pegged to the Chinese yuan , Neutrino JPY (JPYN), pegged to the Japanese yen , Neutrino RUB (RUBN), pegged to the Russian ruble , Neutrino UAH (UAHN), pegged to the Ukrainian hryvnia , Neutrino NGN (NGNN), pegged to the Nigerian naira and the Neutrino BRL (BRLN), pegged to the Brazilian real. Additional assets are voted by the community of NSBT of holders.
In August of 2020, WAVES ported Neutrino USD onto the Ethereum network to expand their access to liquidity for their product and open more opportunities in the realm of DeFi (Decentralized Finance).
Waves core development team strategic advisor, Sten Laureyssens said:
"A large portion of the crypto community has an unsatiated appetite for DeFi. They aren’t profiting from the existing DeFi ecosystem because they either can’t navigate the complex nature, or they don’t have resources to dedicate to price exploration and swaps. Through Neutrino, we can offer a quick path for both Waves and Ethereum community members to earn consistent rewards with minimal effort and risk, and/or maximize their returns through opportunistic DeFi activities"
Neutrino USD holders can stake their assets on the platform for annual yield.
Price Stability Mechanism
The target price of the token is $1.00 USD and is maintained by the mechanics of the Neutrino System Base Token (NSBT). USDN can always be exchanged back for WAVES tokens at a rate of 1 USDN for 1 US dollar. If the price of WAVES against USD rises a reserve fund is set aside as a safeguard against any sudden drops. If the reserve fund is not enough to offset a price drop, NSBT is issued and sold at a discount, allowing users to sell them in the future for a profit. Any further deviations out of this system are maintained by arbitrage bots.
As the number of Neutrino tokens in existence increases, the more WAVES tokens get locked up in reserve and leave the open market, pushing the overall ecosystem in a deflationary direction.
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