Recurring market commentary on what's happening in the crypto markets, summarized by the Crypto Broker team at Crypto Finance AG.
Market commentary
Good morning!
A few days ago I participated in a discussion about stablecoins that are not stable due to their fiat peg, but stable in terms of purchasing power. For crypto maxis who are looking for a settlement coin that is not pegged (non-pegged stablecoin is a new category) to fiat, OlympusDAO (OHM) might be a solution.
To achieve this goal, the OlympusDAO treasury holds different cryptocurrency assets, e.g. DAI, FRAX, ETH, and soon also WBTC. DAI is the floor for OHM. The protocol claims it will always be at least worth 1 OHM >= 1 DAI. Due to their claim that OHM is not aiming to be pegged to fiat but to purchasing power, OHM will trade almost always at a premium to DAI. Currently, OHM is worth USD 526.
The treasury mechanics are similar to many other algorithmic stablecoins. With the minting and burning of OHM, they will steer the supply. To be honest, I have trouble seeing the actual use case in the current cryptocurrency ecosystem. Maybe this or a similar concept might be of more value when real world inflation heats up dramatically and you see your value in fiat-backed stablecoins diminish due to purchasing power loss.
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