Incognito's Very Own Stablecoin

[Revolve]

Objective

Create Incognito’s very own StableCoin backed by Visa Gift Cards
I have devised a plan to raise enough capital to fund Incognito’s very own StableCoin.

• This StableCoin will be redeemable 1:1 via Visa Gift Cards.
• The StableCoin itself will be an ERC-20 Token. (This is because currently on the Incognito network, we are only able to mint tokens at a fixed amount)

Having a smart contract allows us to mint new tokens as needed on the fly.

Key Results

StableCoin: Liquid (LIQD) | 1 pLIQD = $1.10
Redeemable as a Visa Gift Card with a balance of any amount between $25-$500
(This is 1:1, and custom amounts would be allowed)

To distribute this coin through the pDex, it requires a lot of capital, which I don’t have. Instead, we can crowd-source this investment and improve the stability of the network at the same time.

If we create an investment token and borrow the funds raised to supplement liquidity providing for the pLIQD Token, we would be able to jump start the project. Obviously we don’t want people who invest in the investment token to lose money. The plan would be to return the full amount of money after the complete sale of pLIQD Tokens. Users who invest in the investment token would have complete authority and voting rights on how the funds would be managed.

The total amount needed to be raised with the investment token is $2805.
With this amount of money we would be able to sell 5100 pLIQD Tokens which is equivalent to $5610.

After the full sale of pLIQD Tokens, if the owners of the investment token choose to do so, they can vote to use the full $2805 to stake a vNode. The returns would be distributed to investor token holders at specified intervals. However, what happens with the money is solely determined by the owners of the investment token and is not up to me. If they choose to instead invest the money in something else, that is their prerogative, of course they would need majority votes to do so though.

This plan will not work without complete transparency with the community. Especially with the people who decided to invest in the investment token. It is imperative that every transaction made with the raised capital would be written down and broadcasted publicly.

The Plan

The 2 coins needed:

• ERC-20 Token: LIQD
• Incognito Investment Token: iPool-1

The plan consists of 8 Terms. Each Term has an Alpha Stage and a Beta Stage. The Alpha Stage needs to be completed before we can move on to the Beta Stage. Once the Beta Stage is completed, we can move on to the next Term. The time frame for each Term is dependent on how quickly the coins are sold.

[Term 1]

Summary

Alpha:
Add liqudity for iPool-1 Token
$11 of PRV paired with 100 iPool-1 Tokens
Once iPool-1 is completely bought out, we pull out of liquidity
We then move to Beta with a total of $22 in PRV

Beta:
Add liquidity for StableCoin LIQD
$22 of PRV paired with 20 LIQD Tokens
Once pLIQD is completely bought out, we pull out of liquidity
We then reserve $22 in pUSD and move on to Term 2 with $22 of PRV

[Term 2]

Summary

Alpha:
Add liqudity for iPool-1 Token
$22 of PRV paired with 200 iPool-1 Tokens
Once iPool-1 is completely bought out, we pull out of liquidity
We then move to Beta with a total of $44 in PRV

Beta:
Add liquidity for StableCoin LIQD
$44 of PRV paired with 40 LIQD Tokens
Once pLIQD is completely bought out, we pull out of liquidity
We then reserve $44 in pUSD and move on to Term 3 with $44 of PRV

[Term 3]

Summary

Alpha:
Add liqudity for iPool-1 Token
$44 of PRV paired with 400 iPool-1 Tokens
Once iPool-1 is completely bought out, we pull out of liquidity
We then move to Beta with a total of $88 in PRV

Beta:
Add liquidity for StableCoin LIQD
$88 of PRV paired with 80 LIQD Tokens
Once pLIQD is completely bought out, we pull out of liquidity
We then reserve $88 in pUSD and move on to Term 4 with $88 of PRV

[Term 4]

Summary

Alpha:
Add liqudity for iPool-1 Token
$88 of PRV paired with 800 iPool-1 Tokens
Once iPool-1 is completely bought out, we pull out of liquidity
We then move to Beta with a total of $176 in PRV

Beta:
Add liquidity for StableCoin LIQD
$176 of PRV paired with 160 LIQD Tokens
Once pLIQD is completely bought out, we pull out of liquidity
We then reserve $176 in pUSD and move on to Term 5 with $176 of PRV

[Term 5]

Summary

Alpha:
Add liqudity for iPool-1 Token
$176 of PRV paired with 1600 iPool-1 Tokens
Once iPool-1 is completely bought out, we pull out of liquidity
We then move to Beta with a total of $352 in PRV

Beta:
Add liquidity for StableCoin LIQD
$352 of PRV paired with 320 LIQD Tokens
Once pLIQD is completely bought out, we pull out of liquidity
We then reserve $352 in pUSD and move on to Term 6 with $352 of PRV

[Term 6]

Summary

Alpha:
Add liqudity for iPool-1 Token
$352 of PRV paired with 3200 iPool-1 Tokens
Once iPool-1 is completely bought out, we pull out of liquidity
We then move to Beta with a total of $704 in PRV

Beta:
Add liquidity for StableCoin LIQD
$704 of PRV paired with 640 LIQD Tokens
Once pLIQD is completely bought out, we pull out of liquidity
We then reserve $704 in pUSD and move on to Term 7 with $704 of PRV

[Term 7]

Summary

Alpha:
Add liqudity for iPool-1 Token
$704 of PRV paired with 6400 iPool-1 Tokens
Once iPool-1 is completely bought out, we pull out of liquidity
We then move to Beta with a total of $1408 in PRV

Beta:
Add liquidity for StableCoin LIQD
$1408 of PRV paired with 1280 LIQD Tokens
Once pLIQD is completely bought out, we pull out of liquidity
We then reserve $1408 in pUSD and move on to Term 8 with $1408 of PRV

[Term 8]

Summary

Alpha:
Add liquidity for iPool-1 Token
$1408 of PRV paired with 12800 iPool-1 Tokens
Once iPool-1 is completely bought out, we pull out of liquidity
We then move to Beta with a total of $2816 in PRV

Beta:
Add liquidity for StableCoin LIQD
$2816 of PRV paired with 2560 LIQD Tokens
Once pLIQD is completely bought out, we pull out of liquidity
We then reserve $2816 in pUSD and move on to the final phase with $2816 of PRV

[Final Phase]

Users who own iPool-1 Tokens are able to vote on what to do with the raised $2816 of PRV. Hopefully, the goal would be to use the money to help support the network by staking a vNode. If it is decided that they want to do this, the returns from the vNode could get deposited into liquidity in intervals (determined by voters)

There would be a total of 25500 iPool-1 Tokens sold and 51000 minted (25500 of which would be frozen and used for returning money via liquidity).

Overall

iPool-1 Tokens Sold: 25500
iPool-1 Tokens Sold Total Cost: $2805

pLIQD Tokens Sold: 5100
pLIQD Tokens Sold Total Cost: $5610

Total Cost of full Operation: $8415

If there is enough of a demand for more pLIQD Tokens after the sale, we can restart the whole process and create a new investment coin called iPool-2.

iPool-2 investors would have voting rights for their coin only and not for iPool-1.
If both iPool-1 and iPool-2 investors vote to decide to merge their funds together, they can do so if they so wish.

Redeeming for Visa GiftCards

Every time a user wants to redeem their pLIQD Tokens for a Visa GiftCard, they will be able to exchange them through prv.shopping or a similar site. The funds that are reserved in pUSDC will be liquidated on transaction. Users will only have to send 25 pLIQD to receive a $25 Visa GiftCard.

Of course the success of this StableCoin relies on the fact that I can procure enough Visa GiftCards to sell to users, and that in the future, you will still be able to exchange your pLIQD Tokens.

Currently I am working with many different Gift Card providers to establish an automatic link to exchange these pLIQD Tokens for Gift Cards. As time progresses, Visa Gift Cards will not be the only type of card that you can redeem pLIQD Tokens for.

pLIQD Decision Makers

Not only do the people who invested in the iPool-1 Token get voting rights for the capital raised, but they also get special voting privileges on how the StableCoin reserve is handled. If there is ever a decision to be made about how to handle the pUSDC backed reserve, they will be given the opportunity to vote.

However if another token is generated like iPool-2, the votes are split between them based on the percentage of capital provided.

This decentralizes the authority of the StableCoin, making it more community driven.

The Demand

A project like this can not be started without first determining whether or not there is a demand.

So before I list any time frames or even get more technical with the project, it would be beneficial to first gauge the reaction from the community.

1) Would you invest in the pLIQD Token

• Yes
• No

2) Would you Invest in the iPool-1 Investment Token

• Yes
• No

If you have any questions concerns or ideas, please comment below. I would love to hear your criticisms.

[doc]

@Revolve I am interested in this, but still not quite sure I understand the process from an investor perspective…

If an investor was willing to put up the $2,805, what would be the full process, and expected return?

Is it something like, investor provides $2,805 USDC, which is sold for 2,805 iPool-1. The USDC is then placed into pDEX with on a pLIQUD pair? I feel like that is wrong, but dont full understand how that gets done, and then what the investor who provided the $2,805 gets back in return?

Do they just get back $2,805, which they can then use to invest into vNode if they want? If that is the case, not sure why the investor just didnt put the $2,805 into vNode in first place, so I feel like I am missing something here?

I know you have a very good written explanation above, I am just slow and feel like I am missing something…

[Revolve]

I wrote up this whole thing, but didn’t really explain the investor coin all to well (iPool-1). Hopefully I can clear up any confusion with this response.

iPool-1 coins are used to raise capital. Each iPool-1 coin costs $0.11. When you buy an iPool-1 coin, what you are really purchasing is ownership into an investment fund (lets call it the iPool fund). This is a crowd sourced investment fund, and you own voting rights equal to the amount of iPool-1 coins you own. These voting rights give you the ability to choose where the total capital raised should be invested. The idea is to give a lot of smaller investors the ability to own staking percentage in a vNode. This adds more stability to the network and can potentially give higher rewards then the provide tab when you have a smaller amount of capital.

I just realized how over complicated I made everything by breaking it up into a bunch of stages. I think I’m going to re-edit the post to make it more clear and concise. However, I believe breaking it up the way I did, I leverage the money more effectively.

Basically we take the $2,805 in the iPool-1 fund and pair it in the liquidity pool with 2550 pLIQD Tokens. Users buy all the pLIQD Tokens leaving $5610 worth of PRV in the liquidity pool. We pull that PRV out and exchange half of it for pUSDC in a reserve. (That way the 2550 pLIQD tokens have a 100% pUSDC backing.)

The other half of the PRV is returned back to the iPool-1 fund for the owners to decide what to do with the capital (There is no loss, but there is also no gain). However, the amount was specifically chosen to be able to stake a vNode.

You are right in thinking that if you invested the full $2805, you might as well stake a vNode. However, by owning iPool-1 coins, not only do you get voting rights for the capital raised, but you get voting rights over how the StableCoin pLIQD is managed.

[sato]

If I understand it correct all this process is done in order to raise the capital right? To be honest it sounds a little bit complicated to me. Let´s claim someone has 2500 USD and just buys these cards then they would literally be in “stock” and could be sold easily almost in real against pUSDC etc. Please let me know if I´m wrong. The general idea with the gift cards is great by the way, so im sure together we´ll find a solution with our great community to make it real.

[Revolve]

Some gift cards have expiration dates, so it would require a large demand. The way around this would be to liquidate on purchase.

The reason why creating a StableCoin is worth while, would be to have all the activation fees and what not baked into the price. Eventually in the future, hopefully users would also be able to earn a return from the coin in the provide tab.

When you boil it down, the plan consists of two parts.

Raise capital with iPool-1 to crowd fund staking for a vNode. Users will get a return from the vNode based on how much money they put into iPool-1. This is designed for smaller investors.

Before a vNode is staked, the money raised from iPool-1 is borrowed to have enough capital to provide the PRV side of the liquidity in the pDEX for the pLIQD Token.

Once all the pLIQD tokens are sold, the capital is returned to iPool-1 and a node will be staked. People who own the iPool-1 token have complete rights over where the capital goes, and how returns are delivered. They also have voting rights on how the StableCoin pLIQD is managed.