What Is Predictz (PRDZ)?
If no one provides collateral when Predictz is needed, it will easily cause QSD to break into a “death cycling”. In the fractional algorithmic synthetic asset system, when collateral needs to be added, it is often accompanied by a decline in the CEC price and the QSD price below the target price. The additional issuance of CEC tokens during the recollateralization process will undoubtedly intensify the decline in its price. It is very risky if all the stability recovery is pinned on the assumption that the CEC market price can sustain by the market itself.
Therefore, the Predictz Ecosystem development team proposes to release the buffering token CBT during the recollateralization process instead of directly releasing CEC. The CBT minted in redemption and recollateralization cannot be redeemed to CEC immediately. Users can convert CBT tokens to CEC when the system has surplus, that is, in the state of buyback and QSD price exceeds the target. Through this mitigation mechanism, users’ worries about the loss of their own equity caused by the short-term large-scale release and dumping of CEC are eliminated. CBT is actually the regulator of CEC token price.
Predictz Storage Key Points
|Circulating Supply||7,988.40 PRDZ|
|Source Code||Click Here To View Source Code|
|Explorers||Click Here To View Explorers|
|Twitter Page||Click Here To Visit Twitter Group|
|Whitepaper||Click Here To View|
|Official Project Website||Click Here To Visit Project Website|
When the market price of QSD is lower than $1 to an extent, to establish the price stability of QSD and obtain future profits when redeeming, users can buy Predictz stable bond token DBQ with QSD at a discount. Each DBQ bond token can be exchanged back into 1 QSD when the exchange conditions are met in the future. When DBQ bonds are purchased, the QSD will be burned and exit from circulation, so as to reduce the circulation quantity of QSD and promote the price of QSD return to the target value.
DBQ bonds have no interest and no vanished time. Only if the price of QSD is greater than $1, they can be converted into QSD at a ratio of 1:1. This design can prevent bondholders from suffering losses in the process of redemption.
In order to encourage users to actively buy bonds when the QSD discount is large, the system will set a certain discount to encourage users to buy DBQ bonds. At the beginning of the launch of Predictz, the price of DBQ will be set to the third power of the QSD market price. After the market price of QSD exceeds $1.001/QSD, users can redeem QSD from DBQ bond tokens.
In AMMs protocol such as Uniswap and Balancer, the ratio of assets in the pool has to be proportional due to the constant product function, the LP token is just a proprietary rata claim on the pool + fees. In Predictz Labs, the design concept of QSD is similar to this. QSD can be understood as a pool similar to AMM, and the LP token is the stablecoin QSD. The design purpose of QSD is to continue to ensure that QSD is successfully mintable/redeemable with collateral equivalent to the target price and CEC tokens through the current collateral ratio.
The ratio of the underlying assets (collateral and CEC) dynamically changes based on the price of the QSD. If the QSD price is dropping, then the protocol tips the ratio in favor of collateral and less in the CEC token to regain confidence in QSD. If the QSD price rises above the target price, the QSD protocol’s collateral ratio will change in the direction of increasing the proportion of the CEC token algorithm.
Predictz of QSD, which will allocate excess collateral to CEC token holders who call the buyback function. Anyone can burn CEC tokens equivalent to the excess collateral and call the buyback contract to get excess collateral. The “buyback swap” function always keeps value accruing to the governance token any time there is excess fees/collateral/value in the system.
The dynamic change of collateral/stability continues. QSD uses AMM theory to test different Predictz ratios, incentivize internationalization through arbitrage swaps, and redistribute excess value back to CEC holders through a buyback swap. The protocol starts at a 99.8% collateral ratio at the genesis and might or might not ever get to purely algorithmic. The novel insight uses market forces itself to see how much of a QSD can be algorithmically stabilized with the CEC token so that it keeps a tight band around the target price.
Purely algorithmic/rebase designs like Basis, ESD, and Seigniorage Shares have wildly fluctuating prices as much as 40% around $1 that take days/weeks to stabilize before going through another cycle. This is counterproductive and arising the assumes whether the market actually needs a stablecoin with 0% Predictz. From the perspective of stablecoin design, this high volatility of purely algorithmic stablecoins is counterproductive and is not conducive to its final widespread promotion and combination with other DeFi applications. QSD doesn’t make this ideal assumption.
Instead, it measures the market’s preference. It finds the actual collateral ratio which holds a stablecoin tightly around $1, periodically testing small differences in the ratio when the price of Predictz slightly rises/drops. QSD uses AMM concepts to make a real-time fractional-algorithmic stablecoin that is as fast at price recovery as Uniswap and Balancer, keeping trading pools correctly priced.
Predictz Ecosystem developers believe that fractional-algorithmic designs like Frax and QSD are paradigm shifting for stablecoins. It is fast, real-time balancing, algorithmic, governance-minimized, and extremely resilient. QSD will become a trusted stablecoin and all of the crypto community can embrace and practice cryptocurrency development since the advent of bitcoin.