5/17/23 — The SPOTTER Playbook has been released :)

    Spot ...

    a decentralized flatcoin designed to survive black swan events

    Spot — A decentralized flatcoin designed to survive Black Swan events

    The promise of blockchain technology was to deliver a usable global currency, but today’s decentralized stablecoins are poorly conceived. The naive belief that synthetic assets can preserve stability forever prevents protocol designers from proactively considering the case where prices or collateralization-ratios fall outside a predefined band of operation. As a result, they produce stablecoins that are likely to fail catastrophically (ie: triggering bank-runs or cascading liquidations), damaging the market. Or they produce stablecoins that resort to relying on USDC as collateral, invalidating the technology.

    We need to bring some dignity to the space.

    Given that no system can promise stability forever, what we need is a decentralized system that can 1) support extremely long-lived periods of stability, 2) degrade gracefully outside discrete price and collateralization-ratio bands, and 3) resume stable value storage after Black Swan events without bailouts.

    SPOT is a non-runnable, inflation-resistant, stable asset, that is configured to support extremely-long lived periods of stability. The token is a simple proportional claim on a basket of assets that has no limited band of operation and instead functions continuously across all market scenarios. Moreover, SPOT's collateral is tranched in a manner that progressively degrades into its base-asset (AMPL) under stress rather than triggering bank-runs or cascading liquidations.

    The system is designed to bend safely rather than breaking catastrophically in the face of extreme market conditions—and can forever resume its function of stable value storage after disruptions without reliance on bailouts. SPOT can be held directly as a refuge from inflation, used as a peer-to-peer digital cash, or rotated in as alternative collateral to USDC within existing reserves.



     Become a Spotter

    Bad assumptions around the design of decentralized stablecoins have been devastating for the space. Educate and convert new holders by connecting with us on Telegram and following the Spotter Playbook.