#Resolv | Crypto Encyclopedia Chapter 17 š
RESOLV is listed on Binance TR š
Its current price is approximately 11 TL. With this listing, let's take a look together at what RESOLV is and what it does š¤
Resolv offers USR, a stablecoin pegged to the USD but not backed by fiat. It only uses ETH and BTC as collateral, meaning it doesn't have dollar reserves like USDC/USDT. It only has ETH and BTC collateral. Furthermore, it is not centralized or algorithmic; it is completely on-chain š¹
What is USR?
1 USR = 1 USD.
It is minted and redeemable 1:1 with ETH/BTC collateral š¹
What is RLP?
It is an insurance layer that protects USR. Excess collateral creates the RLP. It offers higher returns but also carries risks š¹
So how does USR always stay at $1?
The price of ETH and BTC can fall, but Resolv balances this risk. How? When buying ETH and BTC, it also opens a short position at the same time. If one falls, the other profits. Thus, the total value of the system remains constant š¹
What about the risks?
1ļøā£ Futures costs: If the market moves in one direction for a long time, the funding fees for hedge positions can increase. This can cause losses for the RLP pool š¹
2ļøā£ Liquidity risk:
In case of sudden increases in demand or panic sales, there is a possibility that the RLP may not be able to provide sufficient insurance š¹
3ļøā£ Extreme market movement risk:
If ETH or BTC falls very quickly and the hedge positions cannot be adjusted in time, the system can suffer losses. The system can be particularly strained during sudden crashes š¹
