SINGAPORE, SINGAPORE / ACCESSWIRE / December 17, 2021 / PixelDAO has announced a pioneering decentralized reserve currency specifically tailored to the needs of the Metaverse. The stated aim of the project is to combine the long-term sustainability of protocol owned liquidity (POL) with the Metaverse's exponential growth potential through a protocol optimized for rapid treasury expansion.
Trading under the token PXL, and to be launched on the Harmony blockchain, the currency will be initially based on FRAX, with whom PixelDAO has a direct partnership. In the medium term, other metaverse assets are set to be added to the treasury, with a focus on incubating and seeding small projects. In addition the project aims to provide cross-chain compatibility.
The Metaverse Trend
The past few decades have seen a faster technological evolution than ever before, with the virtual world organically growing into a reality around us. From the internet, over the smartphone, to cloud communication.
According to tech aficionados and industry experts, the metaverse is the next big digital trend to transform consumers' everyday lives. Some even hail it as the successor of the internet as we know it.
In general, the metaverse is projected to be a digital environment that encompasses virtual reality, 3D avatars, augmented reality, and various other channels of communication. Experts see it becoming a hyper-real alternative world anyone can enter at will. Large corporations such as Microsoft and Facebook have already staked their claims on future developments, with Facebook going so far as to change its name to Meta.
Needless to say, the metaverse also holds massive potential for economic development. Projections see it evolving into a trillion-dollar industry, as a virtual space for entertainment, commerce, and digital work.
Crucially, the metaverse is built on blockchains and decentralized applications. As such, cryptocurrencies carry a disproportionate importance in this new virtual reality, especially since all virtual objects and intangible items can be expressed - and owned - as non-fungible tokens (NFTs).
Some experts even predict that cryptocurrencies could become the only legal tender in the metaverse.
The Need for Innovative DeFi Reserve Currencies
Given the importance of crypto for the Metaverse, reserve currencies gain additional significance. Currently, many cryptocurrencies are notorious for their volatility, rendering them interesting prospects for adventurous investors, but unsuited to serve as a stable basis for the metaverse economy.
A less volatile option are so-called stablecoins, which are pegged to fiat currencies such as the USD. However, these are consequently also impacted by real-world policy decisions impacting inflation, such as measures taken by the US government and the Federal Reserve.
Decentralized reserve currencies such as PixelDAO's offer a viable alternative, independent of central financial authorities, guaranteeing stability through mechanisms such as protocol-owned liquidity (POL).
POL was pioneered by Olympus DAO. Its unique staking and bond structure can tie liquidity pool (LP) tokens into a protocol in the form of bonds to maintain liquidity. Crucially, it's the protocol, not any user, that owns these tokens. This, in turns, generates transaction fees from the liquidity pool and simultaneously prevents selling pressure from liquidity providers.
Key to DeFi reserve currencies such as PixelDAO is a backing treasury, which contains assets that guarantee the currency's value.
In the case of PixelDAO, metaverse assets will make up 19% of the treasury, alongside 80% stablecoins, and 1% speculative assets.
Structuring a Diverse Treasury
PixelDAO's metaverse-oriented treasury distinguishes it from many crypto competitors. Its strategy covers three different classes of assets: 80% stable assets, 19% bullish metaverse tokens, also called Metaplay, and 1% highly speculative assets.
The stablecoin share of the treasury ensures strong buy-back power for the POL and helps Pixel retain a healthy Risk-Free Value (RFV). Initially, the stablecoin of choice for Pixel is FRAX. In time, the variety of stablecoins will be expanded and their share in treasury assets will fluctuate depending on market conditions.
The bullish metaplay tokens include liquid staked/governance tokens (xJewel, AXS, and Atlas), LP tokens (Jewel-ONE LP), and Loanable NFT assets (Axies and DFK heroes). For their initial launch, Pixel has announced that metaplay tokens will be limited to xJewel, Jewel-ONE LP, and DFK Gen 0 Heroes. Further down the line, a more diversified asset portfolio will evolve.
The speculative assets, finally, fully exploit the exponential growth potential of P2E/Metaverse assets, based on the expertise of investors, researchers, and analysts in Pixel's Investment Committee. Investments in these assets are to be decided on a governance basis.
Looking Forward, Building on Harmony
Another stand-out feature of Pixel is that it is built on Harmony, a blockchain with the native token $ONE.
Harmony shines with its speed: transactions finalize within two seconds. In addition, it can boast low gas fees, with transaction costs significantly below those on Ethereum.
Furthermore, Harmony also provides extensive cross-chain compatibility, notably with bridges to Ethereum and Binance Smart Chain. All of this makes it an ideal basis for an efficient and supple metaverse reserve currency.
Providing Security and Trust To the Launch and Beyond
As PixelDAO is evolving towards its launch, the development team has taken extensive measures to assure investors that there will be no foul play or rug-pulling.
In particular, PixelDAO relies on a multi-signature wallet, and core team members are undergoing third-party KYC identity verification, including two audit rounds. Pixel's team itself is doxxed to the Harmony team.
Furthermore, Pixel is set to undergo two rounds of auditing - one prior to launch with MCN, and one post-launch with Paladin or Runtime Verification.
A final element aimint to validating Pixel in the eyes of investors is the direct partnership the project has announced with Frax and Sam Kazemmian.
Media Contact :
Pixel DAO
Singapore
Scott Sainz
[email protected]
SOURCE: Pixel DAO