Announcing Variable Time Dollar (VTD)

Today we announce Variable Time Dollar ($VTD), the missing link in DeFi’s algorithmic stablecoin ecosystem.

By providing participants in the algorithmic stablecoin ecosystem with a new option, VTD will:

• Introduce complexity that reduces the advantage of whales
• Reduce risk by enabling new hedges
• Drive growth of both DSD and VTD symbiotically.

VTD is a fork of DSD (which is a fork of ESD). It integrates protocol changes that are designed to strike an important balance between its predecessors. The key innovations are dynamic epoch lengths, and a two-phased bootstrapping period. Other changed parameters include a 70/30 DAO/LP reward split, an anti-bot epoch advance feature, and an Advance Function built into the UI for everyone to use.

Epoch lengths

ESD’s 8-hour epoch length generates relatively low returns and gradual expansion periods. The result is that when ESD goes into supply expansion, it spends a significant amount of time above its 1 dollar peg. Meanwhile, DSD’s 2-hour epochs create relatively high yields that bring rapidly expanding supply and equally massive selling pressure.The result for DSD is shorter but more volatile expansion periods that also bring volatility on the downside. VTD’s dynamic epoch lengths should put it in the Goldilocks zone, bringing just the right amount of yield and volatility at just the right time. The result should be a more stable asset that gradually but sustainably grows its marketcap.

DAO/LP reward split

Where ESD offers an 80/20 split and DSD a 60/40 split, VTD’s ratio is 70/30. VTD’s DAO/LP reward split, by presenting algorithmic stablecoin participants with a new choice, adds complexity to the ecosystem. Not only does the added complexity reduce the ability of whales to game the system, it also introduces new hedging opportunities that can lower/raise risk.

Bootstrapping phase dynamics

VTD integrates a two-phase bootstrapping period with a fixed supply expansion rate of 6%.

Bootstrapping Phase Liquidity Pool Trading Pair: VTD will pair to DSD during its first bootstrapping phase of 36 epochs. This will support early growth of VTD by providing a ready source of VTD buyers. DSD holders who are looking to optimize returns on their holdings may choose to purchase VTD and lock it up along with some of their DSD in order to benefit from the VTD<->DSD liquidity pool rewards.

You can participate through the VTD dashboard at vtd.finance.

For more information on VTD, please refer to our FAQ.