SoK: A Classification Framework for Stablecoin Designs

Moin, Amani; Sekniqi, Kevin; Sirer, Emin Gün

doi:10.1007/978-3-030-51280-4_11

Cited by 75 publications

(55 citation statements)

References 1 publication

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“…Stablecoins are cryptoassets which possess a price stabilization mechanism to maintain some target peg. Here we briefly outline two of the most widely used stabilization mechanisms [26]:…”

Section: Stablecoinsmentioning

confidence: 99%

DeFi Protocols for Loanable Funds

Gudgeon

Werner

Pérez

et al. 2020

Proceedings of the 2nd ACM Conference on Advances in Financial Technologies

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We coin the term Protocols for Loanable Funds (PLFs) to refer to protocols which establish distributed ledger-based markets for loanable funds. PLFs are emerging as one of the main applications within Decentralized Finance (DeFi), and use smart contract code to facilitate the intermediation of loanable funds. In doing so, these protocols allow agents to borrow and save programmatically. Within these protocols, interest rate mechanisms seek to equilibrate the supply and demand for funds. In this paper, we review the methodologies used to set interest rates on three prominent DeFi PLFs, namely Compound, Aave and dYdX. We provide an empirical examination of how these interest rate rules have behaved since their inception in response to differing degrees of liquidity. We then investigate the market efficiency and inter-connectedness between multiple protocols, examining first whether Uncovered Interest Parity holds within a particular protocol and second whether the interest rates for a particular token market show dependence across protocols, developing a Vector Error Correction Model for the dynamics.

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“…Stablecoins are cryptoassets which possess a price stabilization mechanism to maintain some target peg. Here we briefly outline two of the most widely used stabilization mechanisms [26]:…”

Section: Stablecoinsmentioning

confidence: 99%

DeFi Protocols for Loanable Funds

Gudgeon

Werner

Pérez

et al. 2020

Proceedings of the 2nd ACM Conference on Advances in Financial Technologies

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“…This section discusses different types of stablecoin designs at a high level. A Classification Framework for Stablecoin Designs [124] provides more in-depth details. Projects have been 1787 studied or developed for tokens pegged to fiat currencies and cryptocurrencies as well as tokens 1788 that directly represent ownership claims for bank deposits, securities, and central bank reserves.…”

Section: Stablecoinsmentioning

confidence: 99%

Blockchain Networks:

Lesavre¹,

Varin²,

Yaga³

2020

Preprint

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There may be references in this publication to other publications currently under development by NIST in accordance with its assigned statutory responsibilities. The information in this publication, including concepts and methodologies, may be used by federal agencies even before the completion of such companion publications. Thus, until each publication is completed, current requirements, guidelines, and procedures, where they exist, remain operative. For planning and transition purposes, federal agencies may wish to closely follow the development of these new publications by NIST. Organizations are encouraged to review all draft publications during public comment periods and provide feedback to NIST. Many NIST cybersecurity publications, other than the ones noted above, are available at https://csrc.nist.gov/publications.

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“…Several recent papers and industry reports provide overviews of stablecoins [12,17,62,63,71,76]. These typically categorize stablecoins based on the type of collateral used, peg target, and technological mechanics (e.g., on-chain, off-chain, algorithmic) and informally relate stablecoin mechanisms to traditional monetary tools (e.g., interest rates).…”

Section: Introductionmentioning

confidence: 99%

Stablecoins 2.0

Klages‐Mundt

Harz

Gudgeon

et al. 2020

Proceedings of the 2nd ACM Conference on Advances in Financial Technologies

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Stablecoins are one of the most widely capitalized type of cryptocurrency. However, their risks vary significantly according to their design and are often poorly understood. We seek to provide a sound foundation for stablecoin theory, with a risk-based functional characterization of the economic structure of stablecoins. First, we match existing economic models to the disparate set of custodial systems. Next, we characterize the unique risks that emerge in noncustodial stablecoins and develop a model framework that unifies existing models from economics and computer science. We further discuss how this modeling framework is applicable to a wide array of cryptoeconomic systems, including cross-chain protocols, collateralized lending, and decentralized exchanges. These unique risks yield unanswered research questions that will form the crux of research in decentralized finance going forward.

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SoK: A Classification Framework for Stablecoin Designs

Cited by 75 publications

References 1 publication

DeFi Protocols for Loanable Funds

DeFi Protocols for Loanable Funds

Blockchain Networks:

Stablecoins 2.0

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