– NEO Stablecoin & management system
- Alchemint’s stablecoins will have mortgage system of price stabilization
- Alchemint will issue only SDT tokens which is not a stablecoin, but will be used to create the stablecoin
- Stablecoin can be created by anyone
- Alchemint along with its backers (NEO Council, Fenbushi capital) created first NEO stablecoin on its own platform — SDUSD pegged to US Dollar
- 67 page whitepaper describing the management system in great detailes
Alchemint describes itself as a “decentralized price-stable cryptocurrency management system” based on the NEO blockchain. But, unlike other stablecoin developers, Alchemint doesn’t want to launch its own series of stablecoins (like USDT for example), the company rather wants to provide anyone with the tools to launch their own stablecoin on the NEO blockchain. They want to offer a complete stablecoin management solution.
How it works?
A stablecoin sounds like a neat idea. Creating a stablecoin, of course, can be very challenging. But allowing others to create their own stablecoin is even more intrigueing. So how does Alchemint plan to do this? To issue your own stablecoin, you’ll need to mortgage value-fluctuated NEO assets (or any digital assets approved by the Alchemint Governance Committee).
The main benefit of hosting Alchemint on the NEO blockchain is that anyone can check the real-time market value of collateral. You can verify, at any time, the value of the underlying assets of any stablecoin created with alchemint. Meanwhile, smart contracts control transactions in and out of the stablecoin:
There is no need to worry about the runaway, bankruptcy or account suspension of Alchemint for the smart contracts guarantee all the collateral will not be embezzled, explains the Alchemint whitepaper. The holders of stablecoin also do not have to worry about the fluctuating of the market value of collateral.
The first cryptocurrency issued through the Alchemint management platform is called SDUSD, which is a NEO-based cryptocurrency that is “relatively stable with the US dollar”, according to the whitepaper. The coin was created by mortgaging NEO and other digital assets, and the price is supported and stabilized by the Smart Assets Reserve (SAR), a commission lever, and internal and external motivators.
In comes The Smart Assets Reserve
The Smart Asset Reserve is a smart contract based on NeoContract. Using SAR, the platform can guarantee the security, transparency, and auditability of all mortgaged digital assets. Here’s the basic process used by the Smart Asset Reserve to keep prices stable:
Alchemint’s process of mortgaging digital assets works like this:
- First, a user creates a SAR and sends then sends the NEO cryptocurrency for mortgage
- The SAR will then evaluate the NEO deposit, together with its mortgage rate of 200% to send an amount of SDUSD back to the user’s account. For example, someone might send 10 NEO into the SAR, where market price of 1NEO is $100 USD. The mortgage rate is 200% so that the SAR will create a total of $500 SDUSD (10 * 100 USD * 100%/200% = 500 SDUSD).
- If the user wants to withdraw the 10 NEO they sent to the SAR; they must pay back $500 SDUSD back to the SAR and pay a commission fee. Also, nobody can embezzle or steal the mortgaged NEO amount before the withdrawal
- In the case that NEO will break its “liquidation level,” which means is the price of NEO falls beyond a certain threshold, the mortgager must make an additional investment of NEO to establish the value above the liquidation level. If the mortgager takes no action, then Alchemint may choose to liquidate this SAR, and the user may incur additional fees
The liquidation of assets happens in finance and real estate too, so this should not be seen as an unfair practice. A bank will refinance a loan and ask for the house as collateral. The mortgager must make repayments on their investment even if the value of their home falls. Otherwise, the house will be sold at public auction. Alchemint works in the same way but with the liquidation of digital assets.
This process of liquidation is required for Alchemint to keep its currency stable, or the minted SDUSD coins would not have the collateral to support organic growth.
Token Use case
SDT as a functional token of the entire ecosystem, is mainly used to pay commission charge when people redeem collateral if the debt is payed. At the same time, those who hold SDT tokens, participate in the voting governance system of risk management. When SDT is paid, this portion of SDT will be destroyed from the aggregate amount. This means that the greater the demand for stable money, the greater the demand for SDT, and the total amount of SDT will decrease with time.
SDUSD, SDEUR, SDRMB are stablecoins and as such will be pegged to fiat currency.
Token metrics & ICO info
- ICO Date: 12.06.2018
- Ticker: SDT
- Token type: NEP-5
- ICO Token Price: 1 SDT = 0.0800 USD
- Fundraising Goal: 30,000,000 USD
- Total Tokens: 1,000,000,000
- Available for Token Sale: 20%
In total, there will be 1 billion tokens minted by the platform, and they will be distributed as follows:
- 30% Community Development Fund: maintains the continuous development and operation of the Alchemint project
- 20% Public Sale: Used for the platform’s daily activities like marketing, development, and finance, etc
- 15% Private Investor: Private investors will have influence inside and out of the industry and will be helpful to Alchemint
- 10% Cornerstone Investor: Cornerstone investors provide essential help and help with a resource for the development and project of the Alchemint project
- 10% Founding Team Development Team: The founding team assists with the operations of the project, making them an essential resource for the company
- 10% Commercial Promotion: Setup to maintain strategic support for the project
- 5% Consultant: Fee for consultants and legal advice
There are three primary stages of Alchemint’s rollout, named Genesis, Expedition, and Elysium. Genesis will focus on building the required infrastructure for the coin to prosper. The expedition will refactor its blockchain and finance ecosystem based on stablecoins, and Elysium will mark the time when Alchemint’s liquidity reaches trillions of dollars in value, and the beginning of a gradual process to unlink Alchemint from fiat currencies.
Below is a timeline for how Alchemint intends to achieve this:
Project backed by
Whitepaper & Social Media
Telegram members (@10.06.2018): 17,4k
Stablecoin on NEO is one of the last missing links in NEO architecture, and when you see NEO council in the list of backers/investors of the project you can rest asured that this is The Stablecoin. When those guys say they plan to reach trillions of dollars in market value by 2021 one has to pause and think. Unlike Tether, Alchemint is pegging the coin to its fiat counterpart in more natural and secure way — by mortageing. This may not be the best solution but its the one the banks and entire financial system used since they exist. Besides that, providing the approval from Alchemint governance comitee, everyone can create their own stablecoin, which is great for the system — in case something goes wrong and the stablecoin becomes insolvent, it can be shut down once the holders are compensated, but native token SDT lives on and is used to create new stablecoin. The coming ICO is a great opportunity for everyone to be part of NEO’s history.