Stablecoins are boring. But that doesn't stop people from "investing" in them. The thing is though, stablecoins like Tether and USDC are guaranteed to not return anything.
Yet stablecoins account for approximately 1/3 of the entire crypto marketcap so their importance cannot be understated. The stablecoin market has grown over 100x just in the last 2.5 years. If you held stables in your wallet, you got none of that. So who exactly profits from this? Certainly not the holders.
One new upstart project is trying to change that - DXO
DXO which launched just a few weeks ago describes itself as the Bitcoin standard. It introduces a never before seen technology. Users must burn Bitcoin to create DXO. A process called "Forging" (like a blacksmith) according to their whitepaper. $100 worth of BTC goes into the Forge...and 100 DXO comes out. It works with any amount(up to 50K per day). No collateralizing. No need to trust anyone. Everything happens on-chain as you can see the amount of Bitcoin burned in real time. Over 100,000 DXO has been forged already. An impressive start considering you have to burn Bitcoin to create it. But don't call DXO a stable coin - Bscscan
"It is unnatural to force an asset to be stable" - A quote taken directly from the DXO whitepaper. And DXO has been anything but. The price has ranged from 0.94 to over 1.60 since it's debut. But this volatility is seen as a feature, not a detriment. That's why DXO has branded itself as an un-stablecoin. When the crypto markets are going down, like they have been for the past 1.5 years, people rush into BUSD, USDC, and USDT. The stablecoin marketcap has grown over 100x in the last 2 years. But no matter how much buying pressure there is, it remains pegged to the dollar. How is this possible?
What if when people were buying stable coins, the value of the stable coin would actually go up? Therefore creating opportunities for those who reckognized the shift in the markets first. And, this is the most exciting part, what if every time some one bought or sold these stablecoins, holders of the coins received a small part of each and every transaction. This is exactly how DXO works. When people buy DXO on the open market (currently via Pancake Swap), it drives up the price naturally. When some users decide to sell they can do so freely, but they lose a small percentage of their transaction which is then distributed to all the other holders. Instead of just doing business with a bank you can now be the bank. And with every deposit and withdrawal, transfer etc you get a piece of each transaction. Imagine if you were able to get in early on Tether for example, you could have made millions in additional tokens, by just holding Tether...if of course Tether was designed like DXO. DXO hopes to exceed the success of Tether, but this time in a decentralized verifiable way.
It's important to note that DXO is non-inflationary. This is nothing like Luna's USTC where the yield was printed out of thin air due to inflationary tokenomics. DXO is also not algorithmic. It doesn't subtract tokens from your wallet. DXO can only be made from burning Bitcoin and BNB on Bnb Chain. It is also not collateralized.
On the DXO homepage it boldly predicts that all collateralized stable coins will die. Dozens of them have lost their peg in the past year. And even the most popular collateralized stablecoins like DAI have had major issues keeping the collateral over the years. Collateralized stable coins depend on the pirce of other assets. If those assets drop your stable coin will lose it's peg. With DXO you're using the value of Bitcoin to burn to create DXO, their is no risk from the value of BTC falling. If you burned 1 BTC at the top of the Bitcoin price you would have 69,230 DXO. And today you'd still have the same amount, in fact you'd have more - and the value of that would be determined by market participants. Like all assets should be.
DXO has only dipped below $1 once as again, you must use the value of something else to create it. Someone would would have to maliciously burn millions worth of their own Bitcoin and then sell DXO for below their burn value to drive down the price. Only then to probably see the market react by buying up the DXO they sold.
To incentivize users to hold even more, LP staking is also available on their website dxocoin.com with current opportunities above 500% APR. This APR is paid in another token BYAS.
DXO Deflationary Xchange Oputput is the first dapp released under the BYAS ecosystem. With all BYAS dapps you must hold a minimum amount of BYAS to use any of the dapps. You must hold in your wallet more than 100,000 BYAS (currently $45 worth) to be able to use the Forge. More info can be found via the website, as well as their Twitter.