ShapeShift is one of seven DeFi projects to launch the platform’s native “branded dollar.”
Every “oneFOX” token will be pegged to the US dollar and backed by ShapeShift’s native FOX token and another popular stablecoin, USD Coin, thanks to a partnership with the stablecoin platform ICHI (USDC). There are already “oneTOKENS” for Uniswap, Filecoin, Dodo, Perlin Network, 1inch Network, Fuse Network, and Fuse.
In contrast to traditional stablecoins such as Tether’s USDT and Circles’ USDC, oneTOKENS are completely controlled by the project that launches them.
To mint its native stablecoin using ICHI, community members must provide one part native cryptocurrency (e.g., UNI, FIL, FOX, etc…) and one part USDC. The native asset to USDC ratio varies from project to project.
For example, Perlin’s branded dollar has a minting ratio of 98 percent, which means users need $98 in USDC and $2 in PERL to mint 100 onePERL tokens. Filecoin, on the other hand, is 95 percent. FOX token holders will benefit from an 80% minting ratio.
According to Bryan Gross, an ICHI steward, minting the native asset is inherently beneficial for a project.
“Unlike USDC/USDT and DAI, ICHI assists projects in converting total locked value into actual assets under management,” he explained. As a result, rather than having to sell FOX tokens for a stable asset, which would have a negative impact on FOX’s price action, these tokens are removed from circulation at the time of minting.
According to Gross, this increases the scarcity of FOX and raises its price.
ShapeShift is a moving object.
ShapeShift became a decentralized autonomous organization (DAO) in July and distributed FOX tokens to over 900,000 users to encourage governance participation. ShapeShift was a centralized cryptocurrency exchange founded in 2014 by Erik Voorhees prior to this change.
Token holders, rather than a corporate entity, are now responsible for voting on platform developments as a decentralized exchange.
With today’s announcement, these same token holders will have access to a FOX-based stablecoin designed specifically for ShapeShift.