MOTIVATION

Stablecoins are a crucial component in building the infrastructure for DeFi. Currently, there are various attempts in the market, but each of them has its own issues. For example, fiat-backed stablecoins like USDT and USDC are subject to centralized regulation. Any fluctuations in the reserve backing can quickly impact the stablecoin's price, as seen in the case of the bank crisis in March this year, which led to the depegging of USDC. On the other hand, stablecoins like LUSD have ETH as the underlying collateral and are controlled through smart contracts. However, they face limitations in terms of capital efficiency and scalability, lagging behind fiat-backed stablecoins in terms of scale.

We believe that the market needs a new type of stable asset that is not anchored to the US dollar, but instead is issued based on native ETH assets, regulated entirely through smart contracts.