Analysis of the credit token oUSD launched by OPNX

Source: 0xLoki tweet

Summarize:

1. OPNX issues an air currency, oh no credit stable currency (oUSD), or casino chips, and OPNX uses oUSD for settlement
2. Users can use USDT 1:1 to exchange oUSD
3. Users can mortgage BTC/ETH on the chain to mint oUSD, so that the user’s real assets remain on the chain to avoid being embezzled like FTX. If the user’s oUSD is positive (for example, the contract has made money), it can be 1:1 Convert to USDT

First of all, the oUSD launched by OPNX is a credit token, not a stable currency. The following is a detailed interpretation of it:

Let’s imagine a marketplace where people can exchange various collectibles, such as stamps or rare coins, for a special currency called “oUSD”. This marketplace is the OPNX platform, and the collections represent different cryptocurrencies. Against this backdrop, oUSD aims to address three key issues.

Problem 1: Some collectors (lenders) are unwilling to participate in the market because they do not want to entrust their valuable collections (cryptocurrency mortgages) to market organizers (platforms).

Problem 2: Market organizers (exchanges and lending platforms) are reluctant to support certain activities, such as lending collections to traders who want to buy but cannot afford them. This behavior has resulted in losses (bankruptcies) of many market organizers in the past.

Question 3: Some traders hope to use their entire collection (non-stable currency, such as BTC, ETH, OX) as transaction collateral, rather than relying on only a certain type of stable currency (stable currency).

Based on this situation, oUSD, as a new type of market currency, aims to provide people with a more flexible and secure way to exchange collectibles (cryptocurrency), and solve the problem of limited number of stable products (stable currency) provided by lenders or market repayment. problems arising from capacity risks.

Phase 1: Users can purchase oUSD with USDT and trade collectibles with non-stablecoin collateral. They can also pay or receive gains and losses in oUSD, with rates voted on by OX stakers.

Phase 2: Users can deposit EVM-compatible assets into smart contracts, which will be represented as mortgage value on OPNX without direct participation of the platform. In addition, users can pledge oUSD to the vault, earn interest and obtain income from the collateral liquidation of the OPNX exchange.

In short, oUSD is an innovative market currency designed to provide users with a more flexible and secure way to trade cryptocurrencies and solve key issues related to credit, margin and collateral lending in the crypto space.

The design is quite interesting. There are several hidden dangers:

1/ The collateral of oUSD should not be mixed with some strange assets (such as $OX), otherwise it will become UST

2/ An effective mechanism is needed to avoid additional issuance of oUSD in the background, otherwise there is a possibility that the USDT in the PSM will be rugged away

3/ Will this mechanism make the exchange more motivated to become the counterparty of the user?

A simpler understanding is that oUSD is a casino chip. In other places, people use cash to gamble. At OPNX, they first exchange it for chips and then gamble. The exchange of chips not only supports cash, but also supports gold, stocks, refrigerators, color TVs, and washing machines, which are placed at the entrance of the casino. The security guard will show you, and after the bet is over, the settlement will be taken away.

Another advantage is that these collaterals can be used to earn interest, cash is deposited in the bank, and refrigerators, color TVs and washing machines are rented out.