In the previous post, we made an introduction about the existing Synthetics Platforms, their inefficiencies and how Derived Protocol aims to solves these problems. The Derived native Token, also known as DVD, is the main token of the Derived protocol. In this post, we will talk about the native DERIVED token.
Utility of Derived Tokens
The Derived tokens have the following utility in the protocol.
Staking and Minting
The users will be able to stake the DVD tokens to mint the Synthetic stable coin, also known as xUSD. This xUSD token will be the only platform stable coin for accessing all the platform features. The staking of the DVD tokens and minting of xUSD, allows the platform to operate and maintain the liquidity on the platform. The greater the number of staked DVD tokens, the higher will be the availability of xUSD, that is required to access the various platform features like Synthetic DEX, Lending, Borrowing, Hybrid Tokens, Binary Options etc. By staking DVD tokens and minting the xUSD the platform users would be eligible receive the staking rewards.
Users can trade the xUSD minted from staking DVD for various derived assets on the platform or access other platform features. For every transaction there is a small fee (usually 0.3%) collected from these trades. A portion of this fee will also be distributed to the platform users who are staking DVD tokens. The fee will help incentivize the platform users even after the staking rewards are over.
The Derived platform will be completely decentralized. The tokens holders and the community will be able to reshape the future of DERIVED with the use of decentralized governance. The holders of DVD token will be able to participate in the governance and vote on proposals on the platform. Governance will allow the holders to present new proposals which can then be either ratified or rejected by the community members. The Governance voting would be carried out by holder of DVD tokens, thus more the DVD tokens held by an individual the higher will be their influence on the voting.
Thus, the DVD token will be the main utility token on the platform that will allow users to receive staking rewards, accrue platform fee and participate in governance.
Please note that the DVD token contract is not live deployed and we will be releasing more information in the coming weeks on how the community can participate and obtain Derived DVD Tokens.
Derived is the Multi-Chain Synthetics Trading Platform that is leveraging the interoperability features of Polkadot to make the platform available across Blockchains. The Derived platform allows leveraged minting (up to 3x) to its platform users. It will also be the first platform that would allow its user unique features like, the ability to create Hybrid Tokens and access to features like Binary Options, Multiple native currency support, 0% Slippage and Unlimited liquidity among many others.