Origin Protocol – a platform for p2p commerce – has announced an interest bearing stablecoin called OUSD.
Today, we are excited to launch the Origin Dollar $OUSD: the first stablecoin that earns a yield while it’s still in your wallet. 🚀
Learn more about our bold new step into #DeFi here: https://t.co/q5MJSX49dm pic.twitter.com/dAx9buCucu
— Origin Protocol (@OriginProtocol) September 23, 2020
According to co-founder Josh Fraser, OUSD removes any need to stake or lockup funds in order to participate in yield farming. The OUSD token design is meant to save on gas fees and make it convenient to switch between earning and spending. Yield compounds continuously while still being fully available for payments and other peer-to-peer transactions.
OUSD is backed by other stablecoins such as USDT, USDC, and DAI. It generates yield by deploying underlying assets to DeFi protocols such as Compound. For a more detailed summary of the inner-workings of OUSD check out the technical documentation.
One key differentiator between OUSD and other yield-bearing stable assets is that the value of one OUSD will always be $1. IThe Origin team took inspiration from rebase projects like Ampleforth and implemented a feature where the monetary supply of OUSD increases as yield is earned by the protocol. This key change could make OUSD more palatable to the average user as it functions similarly to traditional interest-bearing bank accounts. The value of your dollar never changes, you just get more of it over time.
OUSD Bootstrap
As of today, OUSD will also be integrated into all Origin commerce applications while merchants and sellers on Dshop will be able to accept OUSD as a form of payment.
This initial version of OUSD only leverages lending rates found on Compound, but future iterations will also include revenue from automated market maker fees and reward tokens from liquidity mining. Origin Protocol token holders will also be able to stake their OGN to participate in governance and earn incentives for supporting OUSD.
At launch, the OUSD admin contracts will be owned by a 5 of 8 Gnosis multi-sig contract, with keys to this multisig being by individuals close to the company. The team has stated the OUSD is meant to be fully decentralized in 4 sequential phases, but it is currently unclear if OGN will be the only token to govern OUSD or if it will have its own native governance mechanism.
The abstraction of yield away from the end-user to aggregate a return on idle assets is a common trend giving credence to the growing popularity of DeFi. While Origin is certainly not the first to employ this strategy, their approach to easy onboarding signals that many platform-native stablecoins may be on the horizon.
Visit OUSD.com to learn more and get involved with the Origin community.
Business Development and Operations at TrustToken – TUSD. Jack is a startup generalist and DeFi enthusiast. Stay connected with him by following @HHJackSun on Twitter.