We are thrilled to announce that Dapp.com has officially added nDAU, the world’s first adaptive Digital Currency powered by Cosmos’ Tendermint Core. Analytics for the nDAU blockchain is live and accessible via nDAU’s Profile. Further collaboration between Dapp.com and nDAU will focus on bringing nDAU to a multi-blockchain financial system leveraging Dapp.com’s resources and expertise on DeFi.
As an adaptive digital currency, nDAU is simply a kind of digital money that adjusts supply based on real-time demand, like Ampleforth (AMPL) or Basis Cash. However, Unlike any other DeFi token on Ethereum or BSC, nDAU as part of the Cosmos Ecosystem, runs completely on its own open-source Proof-of-Stake (PoS) blockchain. Aspects related to nDAU’s monetary policy, governance and dependability are embedded within its blockchain, which allows scalability and full transparency.
A quick overview of how major elastic currencies works
$AMPL. The supply of AMPL changes via Rebase mechanism - when the increasing demands push its price over the target price, holders get more $AMPL, vice versa. AMPL aims to be stable at $1.
FEI. Penalty was charged when selling below the target price and incentives are given when buying below the target price. FEI aims to be stable at $1.
nDAU’s target is to be buoyant, which means it is free to rise in value along a bonding curve as demand warrants. nDAU use’s its unique mechanism to decrease volatility:
Repurchasing & Burn at “Floor Price” with the Endowment Reserve
Endowment is a reserve treasure that is used primarily to support the floor price of nDAU. According to nDAU’s system design, half of the Endowment reserve is used to repurchase and burn nDAU from the market at a floor price in order to stabilize nDAU. The floor price is equal to ½ of Endowment, divided by the circulating supply - which is about $2.15 when this announcement is made.
According to the onchain data, there is currently over $30M Endowment Reserve.
SIB (Stabilization Incentive Burn) as An Elastic Gas Fee
Similar to Fei Protocol’s Direct Incentives mechanism which the seller has to pay additional $FEI as penalty when $FEI is off its target range, nDAU adopts its mechanism called SIB, Stabilization Incentive Burn, to stabilize nDAU.
Simply put, SIB will be triggered and implemented when the selling pressure of nDAU makes the market price drop below 95% of the current Next Issue Price in the system. And when SIB is in effect, nDAU holders have to pay a higher transaction fee when sending funds to an exchange address (currently Bittrex, Liquid, and BitMart).
Building its own Tendermint-powered blockchain allows nDAU to scale and also implement its own system, but also gives certain limits to nDAU’s adoption as the infrastructure for Tendermint/Cosmos is less developed compared to Ethereum or other EVM based blockchains. The only way to hold nDAU is to download its wallet app or hold in a CEX.
(Wrapped nDAU aims to increase accessibility to Ethereum, BSC and more)
Like Wrapped Ether (WETH) and Wrapped Bitcoin (WBTC) was created to make Ether and BTC accessible to DeFi, Wrapped nDAU is also allowing the use of nDAU on Ethereum and BSC DeFi ecosystem. Wrapped nDAU will be traded across different DEXs and staked as collertals on DeFi lending platform.
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