Incentivized Third Party Collateralization for Stablecoins

• URL: http://arxiv.org/abs/2309.11521v1
• Date: Tue, 19 Sep 2023 19:09:52 GMT
• Title: Incentivized Third Party Collateralization for Stablecoins
• Authors: Souradeep Das, Dr. Revathi Venkataraman,
• Abstract summary: We propose an alternative architecture for the creation of a functional and secure stablecoin. In this paper we aim to propose an alternative architecture for the creation of a functional and secure stablecoin.
• Score: 0.0
• License: http://creativecommons.org/licenses/by-nc-sa/4.0/
• Abstract: Stablecoins, which are primarily intended to function as a global reserve of value are insubstantial in their design and present many failure points. The primary mechanism to enable these coins to hold on to a fixed value is by backing them with collateral. Fiat collateralized stablecoins require users to trust a centralized entity, which breaks the total concept of decentralization. Crypto collateralized stablecoins have issues involving high collateral requirements and introduces risks of auto-liquidation. In this paper we aim to propose an alternative architecture for the creation of a functional and secure stablecoin.

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