What Is Standard Protocol (STND) And How Does It Work? | KuCoin Crypto Gem Observer

2021/04/30 03:58:33

It is always interesting to see how new technologies are able to reinvent themselves and provide thorough solutions to current issues in the market. Nothing is ever perfect, so when projects are able to identify the problems and develop a product that improves upon what came before it, they can become a catalyst for change.

This is why Standard Protocol was able to create its solution to some of the issues plaguing stablecoins - a staple in the market - and increase the potential possibilities when it comes to bridging the traditional and crypto markets.

What is Standard Protocol?

Standard Protocol is a Collateralized Rebaseable Stablecoin for synthetic assets. It is the first of its kind, and will operate in the Polkadot ecosystem. The goal of the project is to bridge the traditional and cryptocurrency markets through the use of seamless digital products.

It not only focuses on digital currency assets, but also stocks, index funds, commodities and legal currency funds thanks to the use of oracles. This is how the project intends to build this bridge between the two worlds.

How Does Standard Protocol Work?

Standard Protocol saw several different issues facing current algorithmic stablecoins. These were the use of centralized oracles, the lack of focus on sustainable use cases, and the difficulty in tracking auctions.

This is what the project sets out to fix when developing its Collateralized Rebaseable Stablecoin solution. It focused on developing efficient market liquidity by forgoing the auction. Instead, it opts for a system where it deposits liquidated collateral to its AMM pair, allowing MTR holders to purchase other liquidated digital assets.

The project also congregated an ecosystem of decentralized oracles to fix the centralization problem faced in the current market. It was able to leverage these from various sources such as Binance, Coinbase and more.

Then it worked on creating an interoperable ecosystem that acts as a blockchain hub. This enables the sharing of information to other chains with no fees.

Each of these solutions have enabled Standard Protocol to develop the first Collateralized Rebaseable Stablecoin for synthetic assets available on the market.

Who Created Standard Protocol?

Standard Protocol was founded by two individuals. They are Hyungsuk Kang and Jaewon Shin. Both members have experience in the blockchain market, providing them with insights that led to the creation of Standard Protocol.

Hyungsuk Kang is the current CTO of the project, having previously co-founded PolkaKR and worked as a Software Engineer at Plasm. He also acts as Head Ambassador for East Asia of Polkadot.

Jaewon Shin also founded Standard Protocol. He has worked with Hyungsuk previously in the founding of PolkaKR. Notably, he was formerly the Korean Executive Director at BitBlock Group.

Standard Protocol received investment (Private) from investors including CMS, DFG, LinkPad, A195, PhonexVC, Signal Venture, Momemtum 6, Blocksync, Lotus Capital, AU21, D64, CryptoDreamFund, Master Venrtures, partner of Republic crypto.

What is the STND Token?

STND is used as the network and governance token of Standard Protocol, amongst other uses. The token distribution is as follows:

Yield Farming & Staking Distribution: 30%

Funding: 21.3%

Foundation: 15%

Protocol Developers & External Contributors: 10%

Team: 10%

Community Incentive: 6%

Marketing & Ecosystem: 4.7%

Ecosystem Partners & Advisors: 3%

What is the STND Token Used For?

The STND token has several different uses in the wider Standard Protocol ecosystem

First, it is used for on-chain governance. Holders of STND will be able to govern the project and help to shape it going forward.

Next, the token is used for transactions. In order to use Standard Protocol’s systems, there is a fee that must be paid in STND. This payment will subsequently either be burnt or paid to validators.

Then there is its use in Network Staking. Holders are able to stake their STND tokens in order to receive rewards for their role in securing and decentralizing the network.

Finally, there is the stability fee reward, which is paid to STND holders who close their vaults.

Closing Thoughts

The founders of Standard Protocol each have a background in crypto, and are advocates of the Polkadot ecosystem. They identified common issues surrounding current stablecoin implementations and addressed the issues with the help of Polkadot technology.

Standard Protocol is helping to push for further decentralization in the market while also making elements more accessible for newcomers. As its solution is on the right side of history, many people may see Standard Protocol become the standard in many aspects.