What is GaeaCoin? GaeaCoin uses an unprecedented way to “redefine” stablecoins. There are three roles and one system in the GaeaCoin system, namely GAC (GaeaCoin cash), GAB (GaeaCoin Bond) and GASH (GaeaCoin Share equity). Among them, GAC is a “stable currency” anchored to the value of 1 US dollar, GAB is equivalent to bonds, and GASH is equivalent to the equity of the issuer. Both GAB and GASH are designed for the goal of “GAC is equal to 1 US dollar.”
As long as the geneation of money supply amount can be enough based on generation of coin city field price and when adjusting the whole, then GaeaCoin can be a long long time to maintenance support with 1 US dollar peg hook. How to maintain GaeaCoin of stable fixed currency price is always equal to $1 it? The specific approach is as follows:
- False located wanted stability 1 dollar = 1 GaeaCoin generation of currency prices, establishing links with GaeaCoin the dollar. You can follow the hanging hook currency of the exchange rate of change of the increase or collapse scale tightening GaeaCoin substituting token supply should amount.
- The introduction of “ total demand” concept, the total demand describe people who for GaeaCoin behalf currency demand total number. Total Demand = substituting token price * generation circulation coins total number, which is also 19 referred to as the generation of token city value, due to market value of the same kind is described the generation of token bonded Total price value.
- If X represents generation of circulation coins amount, i.e. substituting token supply should amount. False set up over the last few months of demand growth long the GaeaCoin generation of currency cash price of 1.10 US dollars, then: Demand = 1.10 USD*X.
- For the generation of money to restore hanging hook (1) US dollars, fake set up demand does not change , set Y is the desired number in circulation, then: Previous demand = 1.10 USD * X Later demand = 1.00 USD * Y Demand before.
- Solutions out of the Y , is a so-generation token recovery hanging hook 1.00 requirements of $ price value of 1.10 dollar substituting token supply should am- ount: the Y = 1.10 * X.
As a rough estimate the above terms , the currency amount on the discovery, if GaeaCoin transaction prices, temporarily set the p, too high or too low, then the protocol is can pass through now some supply should be multiplied by p will be a long recovery period price to $ 1.00. Also there are some technical details that will be introduced in subsequent chapters. But the core idea is to maintain a long-term link-just measure the price of GaeaCoin and adjust the token supply accordingly.
So GaeaCoin agreement is how to measure given on behalf of the currency price it? How is the supply of tokens adjusted? There are the following feasible solutions:
- By the GaeaCoin block chain system to monitor exchange rates and measured given the price. GaeaCoin block chain will pass through oracle based system (Oracle System) receiving recording GaeaCoin / USD exchange rate. The GaeaCoin protocol establishes data interaction with the ChainLink language machine, and the system automatically adjusts the supply of GaeaCoin.
- GaeaCoin block chain system will exchange rate deviation, amount of expansion and collecting contraction GaeaCoin generation token supply should amount.
- If GaeaCoin transaction price is higher than $ 1.00, then our system will create made and distributed issued new GaeaCoin, which some GaeaCoin will follow the protocol sequence determined to debt coupons currency and stock currency holders and Crypto Credit Network they made the GAC. Debt coupon currency and equity coins are two different categories of generations currency, after the renewal will be detailed solution release.
- If GaeaCoin is trading below $1.00, then the district block chain will create create and pass through open competition price way to sell debt coupon currency, it is no longer in circulation. Debt coupon currency of the purchase order price is lower than GaeaCoin generation of coins, and each one debt coupons coins have a “demand in GaeaCoin expanding large for seasonal press 1 for sale GaeaCoin price” potential. Such mechanisms encourage speculators to participate in debt coupon currency of pins available, and thus contribute to the destruction of the exchange of GaeaCoin, change to take debt coupon currency.
The GaeaCoin agreement with the US Federal Reserve compared to related functions seem to be more easily understood. US Fed a sample, GaeaCoin region block chain system to monitor the price level, and passed through the open market field operation adjustment whole generation token supply should amount. This is in line systems including the record made GaeaCoin or debt coupon currency. Like the US Fed, this operation predicts anchored assets and produces a balance of long-term price indicators in accordance with the money supply theory.
Originally published at https://ethenmanderson.medium.com on June 6, 2021.
