Project Description

Fei Protocol is an algorithm-based decentralized stablecoin protocol, created on Ethereum. It released a white paper and project introduction in January 2021, and started its creation on March 31. A total of 639,000 Ethereum was raised within 3 days, 1.3 billion stablecoin Fei was minted, and a fundraising in the DeFi field was created. new record. Fei Protocol's investment lineup is quite luxurious, with investment institutions including A16Z, Coinbase Ventures, Framework Ventures, ParaFi Capital and Jump Capital.

Compared with the low capital efficiency and expansion problems of traditional over-collateralized decentralized stablecoins, the high volatility of unsecured algorithmic stablecoins at the time, and the withdrawal of liquidity from traditional lending protocols, Fei Protocol proposed a new s solution.

The core differences are:

● The PCV (Protocol controlled value) model is adopted. Unlike MakerDAO and Liquity, users can withdraw their collateral after returning the loan. The collateral minted in the Fei Protocol cannot be withdrawn, but is managed by the agreement, which will be mainly used for "anchor adjustment"-the agreement is for Fei One of the core stability mechanisms of the company will be detailed in the [stable coin mechanism] summary. In addition, the agreement will also use PCV assets through governance in other areas that are beneficial to the agreement in the long term.

● The “direct incentive” mechanism is adopted. When Fei is lower than the anchor target by 1$ and exceeds a certain threshold, users will get extra rewards for buying Fei, and users will get a higher rate of loss if they sell Fei, which is also called “burn mechanism” "

● The project has governance tokens, but it follows the principle of governance minimization. The stability of the system and currency increase and decrease are mainly done by algorithms

However, with the official launch and implementation of the project, many of the above initial mechanisms have been modified through community governance proposals. For example, the sell burn mechanism in "direct incentives" was first cancelled due to community pressure shortly after the launch, and then the entire set The "direct incentive" mechanism was completely abandoned in the FIP-4 proposal in June this year, and a new way to redeem ETH with FEI was added.

Project Description

Fei Protocol is an algorithm-based decentralized stablecoin protocol, created on Ethereum. It released a white paper and project introduction in January 2021, and started its creation on March 31. A total of 639,000 Ethereum was raised within 3 days, 1.3 billion stablecoin Fei was minted, and a fundraising in the DeFi field was created. new record. Fei Protocol's investment lineup is quite luxurious, with investment institutions including A16Z, Coinbase Ventures, Framework Ventures, ParaFi Capital and Jump Capital.

Compared with the low capital efficiency and expansion problems of traditional over-collateralized decentralized stablecoins, the high volatility of unsecured algorithmic stablecoins at the time, and the withdrawal of liquidity from traditional lending protocols, Fei Protocol proposed a new s solution.

The core differences are:

● The PCV (Protocol controlled value) model is adopted. Unlike MakerDAO and Liquity, users can withdraw their collateral after returning the loan. The collateral minted in the Fei Protocol cannot be withdrawn, but is managed by the agreement, which will be mainly used for "anchor adjustment"-the agreement is for Fei One of the core stability mechanisms of the company will be detailed in the [stable coin mechanism] summary. In addition, the agreement will also use PCV assets through governance in other areas that are beneficial to the agreement in the long term.

● The “direct incentive” mechanism is adopted. When Fei is lower than the anchor target by 1$ and exceeds a certain threshold, users will get extra rewards for buying Fei, and users will get a higher rate of loss if they sell Fei, which is also called “burn mechanism” "

● The project has governance tokens, but it follows the principle of governance minimization. The stability of the system and currency increase and decrease are mainly done by algorithms

However, with the official launch and implementation of the project, many of the above initial mechanisms have been modified through community governance proposals. For example, the sell burn mechanism in "direct incentives" was first cancelled due to community pressure shortly after the launch, and then the entire set The "direct incentive" mechanism was completely abandoned in the FIP-4 proposal in June this year, and a new way to redeem ETH with FEI was added.