Rattibha

A new generation of CDPs backed by LSTs occurred.
Get decentralized exposure to RWAs with @u_protocol incubated by @nitrocartel and powered by @LayerZero_Labs
🧵 Thread 🧵
$YOU $U $uBTC
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🐸 Introducing U Protocol
U Protocol is CDP protocol for creating omni-chain, value-anchored assets backed by LSTs.
It will be based on @Arbitrum, but will also expand to others.
The initial key assets are $U and $uBTC, but synthetic dRWAs will follow.
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🐸 Do we even need more LST CDPs?
Absolutely!!!
The stablecoin Mcap is dominated by centralized ones.
Decentralized stables are usually less capital efficient than it's counterparts.
LST backed stables however, have the potential to shift the markets in favor of DeFi.
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🐸 $U and $uBTC
Both of these assets are only backed by $wstETH with the following features,
🔸 decentralized
🔸 omni-chain
🔸 immutable
🔸 0% interest when minted
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$U is a stable pegged to the USD, with a similar pegging mechanism we know from other stables.
There's a soft and hard peg.
Since the min. collateral ratio is 110%, its hard ceiling is $1.10
But you can always redeem collateral worth $1, even if the price falls below.
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$uBTC is the equivalent to $U just pegged to the $BTC price.
The advantage of not being reliant and no need to trust a third party like with $wBTC is a huge step toward real decentralization.
And arbitrage mechanisms will adjust the price, which means no hard peg.
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🐸 Value-Anchored Assets (VAA)
VAAs are synthetic representations of other on/off-chain assets.
• Cross-chain assets
• RWAs
The mechanism works with over-collateralization.
e.g. a synth token, which represents the gold price backed by $wstETH
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Basically any synth token can be created as long as there's a price feed.
The advantage of a synth eco-sytem is capital efficiency since you hold a yield baring token and enhance your liquidity.
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🐸 Cross-chain minting
Users can collateralize assets from different EVM compatible chains and mint synthetic assets.
Those minted token are OFT standard and can be used cross-chain and you're not caught on one chain.
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🐸 Tokenomics
$YOU is the omni-chain governance token, but there's not much info out yet.
So we have to wait for an update.
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Not to forget U_Protocol holds a huge junk of $veAERO
So a lot of voting power here...
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🐸 Conclusion
I like @u_protocol's approach to bring more decentralization to the space.
The concept of decentralized exposure to any assets in a trust-less manner and capital efficient way is a big win for DeFi!
Keep in mind, RWAs will explode at some point in the future
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In general, LSTfi dramatically changes liquidity and opens up the possibility of earning on multiple layers.
Everything without paying interest and border-less due to the OFT standard, which brings the space closer together.
Short overview by @Baseinsider_TIG
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If you have a shitty irl job and don't know what to do, play a round of Running Do Kwon: The U Protocol Game
Avoid centralized assets and catch $U and $uBTC...
game.uprotocol.finance
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