Celo Dollar, or CUSD is a decentralized algorithmic stablecoin issued by Celo. It is a product in Celo’s suite of offerings that aims to make financial tools more accessible to everybody over the world through a smartphone.
As a USD-backed stablecoin, 1 CUSD is expected to be exchangeable to 1 USD, more or less.
CUSD is an algorithmic stablecoin whose price and peg are maintained by algorithms and a crypto assets-based reserve named Mento. To elaborate, the mechanism that Celo builds creates an incentive for people to determine the supply of CUSD by letting the price of 1 CUSD be equal to $1 of CELO token at all times. The protocol boasts that users can always take profit with CUSD this way. When the price for CUSD is above $1, users can buy $1 worth of CELO tokens, then exchange for 1 CUSD on the protocol, then sell CUSD at the marke t price. Or when the price for CUSD is below $1, users can exchange 1 CUSD for $1 worth of CELO tokens, then sell CELO at the market price.
Though this is what Celo says to attract users, they have a system in place to avoid exploitation of CUSD that can lead to depeg, such as oracles or Granda Mento, requiring users to lock their CUSD funds and have them sold over a few days if the number of CUSD is considered large, etc.
How Many Celo Dollar (CUSD) Tokens Are in Circulation?
CUSD’s total supply: 1,000,000,000,000,000 (fifteen zeroes)
CUSD’s circulating supply: 43,326,039
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