DarkNess Is Rising
DarkNess Dollar introduced the world to the new concept of a cryptocurrency being partially backed by collateral and partially stabilized algorithmically.
Stablecoin — a digital asset that is pegged to fiat currency — is considered the most important cornerstone in DeFi. Stablecoins provide an excellent method to park money during trading or to use as a base currency. The most prominent use case of stablecoins is stability and how it helps cryptocurrency users, especially traders, hedge against volatility.
There are several types of stablecoins, including fiat-backed, crypto-collateralized, and algorithmically stabilised stablecoins. While fiat-backed stablecoins are not 100% decentralised, crypto-collateralized stablecoins like DAI have issues of over-collateralization. On the other hand, purely algorithmic protocols such as BasisCash, ESD, Tomb and others provide a very noble solution to establish stablecoins with no backed assets. The issue with purely algorithmic protocols is their inability to efficiently react to volatility, which results in many of these “algo-stables” ending up in a dead zone and away from the $1 peg.
In that context, DarkNess Dollar was born.
Inspired by FRAX’s design of fractional algorithmic stablecoin and learning from the issues of similar protocol, DarkCrypto is proud to introduce DarkNess Dollar - the first partial-collateralized stablecoin on Cronos Chain.
DarkNess Dollar is a stablecoin with parts of its supply backed by collateral and parts of the supply algorithmic. This means DarkNess Dollar is a stablecoin to have part of its supply floating/unbacked.
The ratio of collateralized and algorithmic depends on the market's pricing of DarkNess Dollar stablecoin - DUSD. If DUSD is trading at above $1, the protocol decreases the collateral ratio. If DUSD is trading at under $1, the protocol increases the collateral ratio.
DarkNess Dollar attempts to be the first stablecoin protocol on Cronos chain to implement design principles of both Entirely Collateralized and Purely Algorithmic Stablecoins. We are aiming to create a highly scalable, trustful, extremely stable, and ideologically pure on-chain money.