What is VeUSD? Everything About VeChain’s Stablecoin

VeUSD is the first native, USD-backed stablecoin on the VeChain blockchain. Here’s all you need to know about VeUSD.

What is VeUSD?

VeUSD is a U. The VeUSD stablecoin was launched in May 2022. VeUSD is the first stablecoin native to the VeChainThor chain, developed by the VeChain Foundation, in collaboration with Stably, a U. VeUSD is a VIP-180 token, which is a subset of the ERC-20 standard. While VeUSD cannot be subject to price volatility , it benefits from many cryptocurrency particularities. You can find all VeUSD blockchain transactions on the VeChainThor block explorer.

The VeChainThor blockchain has a growing ecosystem and needs VeUSD as a medium of exchange. Vexchange, an automated liquidity protocol on the VeChainThor blockchain, is the first platform to integrate VeUSD. Vexchange users can trade VeUSD and withdraw the funds for cash via Stably Prime. Other centralized and decentralized exchanges will probably list VeUSD as well.

Is VeUSD regulated?

VeUSD was created by Stably, an asset tokenization infrastructure provider based in the U. Stably was chosen to create VeUSD due to their strict compliance with U. After creating an account on Stably Prime, they can deposit USD to quickly convert it into VeUSD. You can also deposit other stablecoins on Stably Prime and convert them into USD. Then, you can convert the balances to the stablecoin.

VeUSD will always be pegged to the US dollar

Each VeUSD will always be fully backed with fiat money because each user has to deposit collateral to mint new VeUSD stablecoins.

How does VeUSD work?

Stably allows users to redeem and mint VeUSD stablecoin tokens. Users can buy and sell VeUSD for cash via our stablecoin platform, Stably Prime. To start using Stably, you will need to sign up and then enable trading on your account by verifying your identity.

Here are the main steps for getting started with Stably

To create VeUSD stablecoins, you will need to deposit USD or other assets accepted by the platform.

How does Stably work?

Users can trade VeUSD on Vexchange and then use Stably Prime to withdraw it directly to their bank account. VeUSD vs. Some stablecoins are 100% collateralized, some are only partial collateralized, and some are known as algorithmic, which means they use an algorithm to preserve their pegged value. Collateralized stablecoins can be minted or burnt when assets are deposited into the reserve.

For collateralized stablecoins that are pegged to US dollars, such as VeUSD, one token is minted for each $1 USD deposit and one VeUSD token is burnt for each $1 USD withdrawal. When assessing stablecoins, the most important thing to look at is their ability to keep their pegs. Collateralized stablecoins are liquid assets that can quickly be traded to respond to fluctuations in demand and supply. Algorithmic stablecoins do not require collateral and rely on smart contracts for theoretically unlimited liquidity.

Algorithmic stablecoins do come with risks

Overall, collateralized stablecoins such as VeUSD have a much lower chance of losing its peg than algorithmic ones. VeUSD has a liquid collateral that can be transferred faster than other assets, and this is the ideal case for stablecoins.

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Source: VECHAIN FOUNDATION | COINMARKETCAP.COM

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