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Summary of Davos.xyz USD
- Davos Protocol: a decentralized collateralized debt position (CDP) system for minting DUSD, an omnichain stablecoin.
- System allows overcollateralized borrowers to deposit reward-bearing assets (liquid staking tokens) to secure DUSD.
- Yield capture fee: up to 50% on reward-bearing assets, transformed into borrowing incentives.
- Protocol revenue: borrowing rates, redistributed to liquidity providers based on total value locked (TVL) in each pool.
- Governance: Davos Governance Token (DGT) holders vote on protocol alterations, ensuring a democratic decision-making process.
- Figures: 50%
- Case
About Davos.xyz USD: A Pioneering Stablecoin Initiative
The Davos Protocol is a fully decentralized, collateralized debt position (CDP) system, meticulously designed to facilitate the seamless minting of DUSD, a versatile, omnichain stablecoin.
This system facilitates the creation of DUSD by enabling overcollateralized borrowers to deposit reward-bearing assets, notably liquid staking tokens, into the system, thereby securing the issued DUSD omnichain stablecoin.
In the protocol, a yield capture fee of up to 50% is levied on reward-bearing assets, which is then converted into borrowing incentives. The value of these incentives is directly correlated with the collateral type that generates the highest yield. Moreover, the protocol accrues revenue through the borrowing rates it imposes, and subsequently channels this income back to liquidity providers in proportion to the total value locked (TVL) of each pool. A similar methodology is applied to lenders and participants of the DUSD Redistribution Rate, ensuring a fair and equitable distribution of revenue.
The protocol’s governance is facilitated through the Davos Governance Token (DGT), which confers upon its holders the authority to cast votes on proposed alterations to the protocol. By virtue of their DGT holdings, individuals are endowed with the right to propose and vote on changes, thereby ensuring a truly democratic decision-making process.