A DYNAMIC RESERVE CURRENCY BUILT TO WEATHER THE ECONOMIC STORM

TL;DR SupremeDAO is building a digital currency that maintains high liquidity, a degree of stability, and has some exposure to other assets. The currency, KAI, is designed for businesses to hold a semi-stable asset, investors who want a low-risk, interest accruing crypto, and startups in their early stages seeking capital and users.

OVERVIEW All assets, including currencies, are volatile in relation to other assets.

Recently, the euro and dollar almost reached parity; in Argentina and Turkey, inflation is over 100% annually. The global economy is experiencing first hand that currencies fluctuate in value like any other asset.

Traditionally, currencies were not intended to be volatile. They were a medium of exchange, which meant the same product could be exchanged for the same amount of currency every day. Because of this, currencies are not thought of as stocks even though they have become similar to holding shares to an economy. The value of a currency is thus contingent to the performance of its market economy.

The emerging field of cryptoeconomics has enabled online communities to form internet-native economies where the token market capitalization acts as a representation of the success of a certain crypto community. However, while some say Bitcoin or Ether are forms of currency, they aren’t–they’re speculative assets. This became apparent during the 2017 ICO bubble, where projects that held their treasuries in Ether lost most of their value after the crash. This means that businesses deciding to use crypto assets in day-to-day operations or treasury optimization should be cautious, as relying on such volatile crypto markets comes with risk.

Stable coins are a partial solution. Holding USDC or USDT might stabilize one’s financial situation during volatile market conditions which is helpful on downturns. But it can be frustrating to miss out on gains during bull runs.

SUPREME SOLUTION SupremeDAO is building a new type of currency that maintains high liquidity, a degree of stability with upside potential, and some exposure to other assets. The current economic landscape requires it for the following reasons:

1. Most businesses should be subject to low volatility for their cash on hand.

2. With the changing currency landscape, assets backing a token will need to change over time in order for it to remain stable. The question becomes ‘stable in relation to what?’

3. Banks execute simple functions like providing loans to businesses. Oftentimes, small or new businesses cannot get the capital they need from banks. Even if they can get a loan, their contribution is generally not affecting the market cap of the US economy. Their stake and influence is minimal in such a large system.

The dollar is still the dominant world reserve currency, and it will probably remain that way for years to come. That’s why SupremeDAO is initially utilizing stablecoins as the primary reserve asset. This ensures dollar-backed liquidity, and the majority of value in a form that is globally considered safe.

The DAO will decide which assets should be a part of its Basket of Assets(treasury) over time. The main goal of the Basket is to act as collateral to the DAO’s currency - KAI(Japanese for ‘shell’- ancient form of money). The total supply of KAI is correlated to the value of Basket.

Soon more technical details will be released. In the meantime, the main thing to know is that new users mint KAI by depositing their stablecoins into the Bonding Curve. The stablecoins get exchanged for the assets in the Basket.

Over time the Basket of Assets will become dynamic, and be controlled through DAO governace. The intended effect is to create a currency that:

1. Is liquid enough to trade for other assets when needed.

2. Gives holders risk-minimized exposure to market movements.

3. Rewards it’s users for being a part of the economy, like a cooperative.

The DAO will assess market conditions, Basket composition, and determine appropriate methods of inflation - which can be useful to keep people in the economy and bring in new participants through loans.

The target holders for this currency are:

1. DeFi protocols that want to diversify their treasuries into a semi-stable currency

2. Investors who want a hands-off, low-risk approach to participating in the crypto markets

3. Web3 startups that need early stage funding and users

4. Local businesses who currently struggle to get loans and want to plug into a network of other businesses and customers in our economy

CONCLUSION SupremeDAO will balance stability and risk for its holders in changing market conditions. As the supreme economy grows, the incentives to use it get better over time. With more businesses accepting KAI, there will be less reason to exit the economy. The system can adapt to support any assets the world decides to use as a reserve currency.

In today’s rapidly changing economy, we need dynamic currencies that can adapt at the same pace and provide peace of mind, as well as value for their users.

A DYNAMIC RESERVE CURRENCY BUILT TO WEATHER THE ECONOMIC STORM

TL;DR SupremeDAO is building a digital currency that maintains high liquidity, a degree of stability, and has some exposure to other assets. The currency, KAI, is designed for businesses to hold a semi-stable asset, investors who want a low-risk, interest accruing crypto, and startups in their early stages seeking capital and users.

OVERVIEW All assets, including currencies, are volatile in relation to other assets.

Recently, the euro and dollar almost reached parity; in Argentina and Turkey, inflation is over 100% annually. The global economy is experiencing first hand that currencies fluctuate in value like any other asset.

Traditionally, currencies were not intended to be volatile. They were a medium of exchange, which meant the same product could be exchanged for the same amount of currency every day. Because of this, currencies are not thought of as stocks even though they have become similar to holding shares to an economy. The value of a currency is thus contingent to the performance of its market economy.

The emerging field of cryptoeconomics has enabled online communities to form internet-native economies where the token market capitalization acts as a representation of the success of a certain crypto community. However, while some say Bitcoin or Ether are forms of currency, they aren’t–they’re speculative assets. This became apparent during the 2017 ICO bubble, where projects that held their treasuries in Ether lost most of their value after the crash. This means that businesses deciding to use crypto assets in day-to-day operations or treasury optimization should be cautious, as relying on such volatile crypto markets comes with risk.

Stable coins are a partial solution. Holding USDC or USDT might stabilize one’s financial situation during volatile market conditions which is helpful on downturns. But it can be frustrating to miss out on gains during bull runs.

SUPREME SOLUTION SupremeDAO is building a new type of currency that maintains high liquidity, a degree of stability with upside potential, and some exposure to other assets. The current economic landscape requires it for the following reasons:

1. Most businesses should be subject to low volatility for their cash on hand.

2. With the changing currency landscape, assets backing a token will need to change over time in order for it to remain stable. The question becomes ‘stable in relation to what?’

3. Banks execute simple functions like providing loans to businesses. Oftentimes, small or new businesses cannot get the capital they need from banks. Even if they can get a loan, their contribution is generally not affecting the market cap of the US economy. Their stake and influence is minimal in such a large system.

The dollar is still the dominant world reserve currency, and it will probably remain that way for years to come. That’s why SupremeDAO is initially utilizing stablecoins as the primary reserve asset. This ensures dollar-backed liquidity, and the majority of value in a form that is globally considered safe.

The DAO will decide which assets should be a part of its Basket of Assets(treasury) over time. The main goal of the Basket is to act as collateral to the DAO’s currency - KAI(Japanese for ‘shell’- ancient form of money). The total supply of KAI is correlated to the value of Basket.

Soon more technical details will be released. In the meantime, the main thing to know is that new users mint KAI by depositing their stablecoins into the Bonding Curve. The stablecoins get exchanged for the assets in the Basket.

Over time the Basket of Assets will become dynamic, and be controlled through DAO governace. The intended effect is to create a currency that:

1. Is liquid enough to trade for other assets when needed.

2. Gives holders risk-minimized exposure to market movements.

3. Rewards it’s users for being a part of the economy, like a cooperative.

The DAO will assess market conditions, Basket composition, and determine appropriate methods of inflation - which can be useful to keep people in the economy and bring in new participants through loans.

The target holders for this currency are:

1. DeFi protocols that want to diversify their treasuries into a semi-stable currency

2. Investors who want a hands-off, low-risk approach to participating in the crypto markets

3. Web3 startups that need early stage funding and users

4. Local businesses who currently struggle to get loans and want to plug into a network of other businesses and customers in our economy

CONCLUSION SupremeDAO will balance stability and risk for its holders in changing market conditions. As the supreme economy grows, the incentives to use it get better over time. With more businesses accepting KAI, there will be less reason to exit the economy. The system can adapt to support any assets the world decides to use as a reserve currency.

In today’s rapidly changing economy, we need dynamic currencies that can adapt at the same pace and provide peace of mind, as well as value for their users.