Origin Dollar (OUSD) Expands to Offer a Non-Rebasing Tokenized Vault

Origin DollarOrigin Dollar
blog.originprotocol.com2m ago

Origin Dollar (OUSD) Expands to Offer a Non-Rebasing Tokenized Vault

Wrapped OUSD

Since OUSD was launched during the Summer of 2020, it has proven to be one of the best-performing, most trusted ways to earn yield from DeFi. By combining the concepts of a yield-bearing vault with a rebasing stablecoin, OUSD brings simplicity, gas savings, and convenience to farmers who would otherwise be forced to navigate a web of complex staking transactions and actively manage their portfolios. Today, we’re introducing wrapped OUSD (wOUSD): a second flavor that will further improve the composability of OUSD and expand its addressable market.

Two flavors, up only

Comparing the two

OUSD is unlike any other stablecoin. It is pegged to the dollar, not by decree or algorithmic hand-waving, but by over-collateralization with the top three most proven stablecoins (DAI, USC, USDT). But what makes it special beyond its strength and stability is that it grows every day. By deploying the underlying collateral to battle-tested DeFi strategies, the protocol earns yield and distributes it in the form of additional units of OUSD. Users simply hold the stablecoin in a regular Ethereum wallet and their balances will go “up only”, all of the time.

Wrapped OUSD (wOUSD) provides the same compounding yield with the same level of trust and stability. Only, it abstracts away the rebasing nature of OUSD. Instead of the balance increasing every day, the price increases every day. This is because wOUSD can be unwrapped at any time in exchange for an ever-increasing balance of OUSD. So as yield is generated by the protocol and distributed continuously to OUSD holders, the price of wOUSD reflects this earnings growth that will be realized when it is unwrapped.

Why wrap

The entire DeFi ecosystem is built upon the premise of composability. This “money Lego” characteristic is unique to our open financial system and it’s a catalyst for rapid growth and innovation. However, the rebasing nature of OUSD presents an extra layer of complexity for anyone wishing to integrate the token into their projects. Even though OUSD conforms to the ERC-20 token standard, it behaves differently as a yield-bearing token and developers may need to account for this when building their applications. Many of the most established exchanges and decentralized protocols still lack support for rebasing tokens. This all presents an obstacle for OUSD to become a core DeFi building block and a ubiquitous payment method across the industry.

With the introduction of wOUSD, anyone can leverage the yield-bearing aspects of OUSD without needing to build a custom interface to account for constantly increasing token balances. wOUSD is one of the first implementations of EIP-4626, which is an extension on ERC-20 that provides basic functionality for depositing and withdrawing tokens and reading balances on a tokenized vault. In addition to following this new standard, wOUSD has also been independently audited by Solidified and it’s ready for production use.

Individual token holders and institutions may also find it preferable to hold wOUSD compared to OUSD. In some jurisdictions, the tax treatment of wOUSD price appreciation may be different from the token accumulation that occurs daily with OUSD. In other cases, there may be unique constraints that cause users to have a greater appetite for the wrapped version.

How to

Getting wOUSD is simple. You start by holding OUSD and then wrapping it by submitting two Ethereum transactions. We look forward to wOUSD being available for purchase directly on exchanges and automated market makers soon, but you’re early. 😉 If you don’t already have OUSD, you can buy it from Gate.io, KuCoin, Curve, Uniswap, or get it directly from the OUSD DApp.

Once you have OUSD in your wallet, visit ousd.com/wrap and follow these steps:

Connect your wallet Enter the amount of OUSD that you want to wrap Submit the allowance for the wOUSD contract to use your OUSD Submit the transaction to wrap your OUSD ousd.com/wrap

As time passes, the virtual price of wOUSD will increase. When you’re ready to unwrap your OUSD, there will be more of it than there was when you initially wrapped it. There’s no minimum term or lock-up period. You can return to the same form and submit a single transaction (in the opposite direction) to unwrap your OUSD.

Building for the long term

As OUSD continues to evolve as an upgrade over ordinary stablecoins, security and stability will always remain the top priority. The Origin core team is committed to growing OUSD during every market cycle with a vision to create the superior payment method for Web3. This involves maintaining the trust of our users with each additional feature and wOUSD is no exception. After extensive testing and an external audit, we’re excited to see how wOUSD is used in the wild. If you’re a developer looking to integrate OUSD into your application or a humble farmer seeking the best risk-adjusted yields, we would love to hear from you.