Duet US Dollar (dUSD) is a synthetic stablecoin whose value is pegged to USD through over-collateralization.
Name (SYMBOL): dUSD (DUET USD)
There are two ways a dUSD can be minted---through the over-collateralization minter or the Stablecoin Minter.
With the Stablecoin Minter, users can mint dUSD with whitelisted stablecoins (currently BUSD & USDC) at a rate close to 1:1.
With the Over-Collateralization Minter, users can mint dUSD with any supported asset at corresponding collateralization ratio.
With every dUSD minted, Duet protocol reserves more than 1 USD worth of assets to support its value. Thus the value of dUSD will always be equal to 1 USD.
Stablecoin market is extremely competitive, legacy projects like USDT, DAI, USDC are competing with new stablecoins like UST as well as potentially with CBDCs in the future.
Despite their claim to be stable and value-backed, Duet governance will rate the stable coins similar to how bonds are rated by agencies, only AAA rated stable coins will be whitelisted to generate dUSD with 100% utilization rate, while others can be used to generate dUSD using a over-collateralization method
Duet charges 0.2% fee whenever a dUSD is minted or redeemed.
Although Stablecoin minter only accepts whitelisted stablecoins, situations might arise where a whitelisted stablecoin lost its peg to US dollar.
When the value of a whitelisted stablecoin falls below 0.98 USD, a circuit breaker is triggered, so that users can no longer mint dUSD with that stablecoin with the stablecoin minter.
The circuit breaker protects the peg of dUSD to USD during extreme events where a whitelisted stablecoin significantly deviates from its peg.