USDST Savings Vault Earn 8% APY with STRATO
Summary
In STRATO this announcement explains USDST and the USDST Savings Vault offering 8% APY. It covers USDST as a decentralized, over-collateralized stablecoin mintable against ETH, USDC, and USDT, and notable support for real-world gold and silver collateral. The vault redirects protocol interest to savers, giving the community yield and a more spendable gold-backed stablecoin option.
You can think of STRATO's USDST as a version of the USD before 1970:
Gold-backed
But more spendable than gold
Except that USDST is now offering 8% APY through the USDST Savings Vault on https://t.co/CaZsoWnhtQ
"Yeah, okay. So the USDST Savings Vault is as follows:
USDST is a decentralized stablecoin, somewhat similar to USDs, which I mentioned earlier. You can actually create it yourself, in contrast to USDC or USDT — for those, it's a pretty gate-kept process to create a new token.
In our case, it's a protocol. The way it works, basically, is over-collateralized borrowing: you send ETH to the protocol, and you can draw down the stablecoin against it, up to a certain amount.
Similarly, you can directly mint it — which is kind of equivalent to a hundred-percent LTV, zero-interest — against popular stablecoins like USDT and USDC, and that also helps maintain it at about a dollar. So that's how the token gets into circulation.
The unique thing about it, compared to USDs, is it allows real-world-asset collateral — in particular gold and silver. So if you squint at it, you can combine the idea of the gold token, the silver token, and the dollar token — it starts to look a little bit like the U.S. dollar in the 1970s, being actually most like the gold token, but going from gold to the actual dollar denomination, more spendable in practice, at point of sale and so on.
The savings flavor — what you find is that for any emerging stablecoin, people go back to the biggest, most liquid stablecoin, so you find the price goes down or the supply shrinks, and then goes up and shrinks, and so on. What you want is the supply to increase but the price to hold. So the way we're doing that is the protocol redirects some of the borrow interest that happens when it's created — and other sources — into a savings flavor, whereby if, instead of converting it right away, you just lock it up, you earn, denominated in the token. And we have a little bit of STRATO rewards on top as well.
So that is a problem the savings vault is meant to solve for us — trying to balance out the outbound (USDST to USDC or ETH or what have you) and the inbound (liquid crypto to our stablecoin). Victor will show all that pretty soon."
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