The much-anticipated decentralized stablecoin known as USN has launched today on Near Protocol, according to the account address displayed on Near’s official blockchain explorer.
The USN stablecoin has gone live
The launch confirms previous rumors about the stablecoins, which at the time only included limited information about its specifics. The stablecoin is designed similarly to TerraUSD (UST), which has received much attention in recent weeks and can be minted by depositing in NEAR tokens, the Near blockchain’s native crypto asset as collateral.
The USN stablecoin initiative is led by an independent team known as Decentral Bank, a Decentralized Autonomous Organization (DAO). It collaborates with Proximity Labs, a DeFi-focused team in the Near ecosystem. The USN stablecoin does not pay as high a yield as expected, but it does offer a 10% annual yield from Decentral Bank.
How does the stablecoin function?
As previously stated, USN is a decentralized stablecoin that, like $UST, does not hold dollar cash reserves. To ensure USN’s ability to maintain its peg, Decentral Bank DAO will implement a few stability mechanisms. The first is an arbitrage system that will ensure that the stablecoin trades for approximately one dollar worth of NEAR tokens. The second is a fund consisting of NEAR and USDT tokens held by the DAO treasury.
The stablecoin appears to bring more liquidity to the NEAR ecosystem, similar to how $UST and Anchor Protocol drove the Terra ecosystem’s adoption. Other blockchains follow suit, with Tron founder Justin Sun announcing plans to launch a decentralized algorithmic stablecoin called USDD on the TRON blockchain network.