Sonic co-founder and main architect Andre Cronje teased plans on 25 March to Launch a new algorithmic stabilecoin on the network within five weeks.
Cronje emphasized that the new Stablecoin could offer more than 19% in an annual percentage of yield to $ 1 billion total value locked (TVL).
He Previously said On March 20:
“Pretty sure that our team today cracked Algo -stable coins, but the previous cycle did not give me so much PTSD not sure if we should implement.”
Cronje referred to high -profile scandals with algorithmic stablecoins such as Terrausd (UST), which collapsed and caused almost $ 40 billion in losses for investors. The delivery caused widespread control of algorithmic models for stablecoins.
Despite the first hesitation, Cronje proceeded to share technical benchmarks. On March 22, he a proof of concept published (POC) indicating that the Stablecoin would yield more than 200% Apr at $ 10 million to TVL, falls to around 23.5% in $ 100 million and stabilizes almost 4.9% above $ 1 billion in TVL.
On March 24, he Reported optimization Breakthroughs that considerably raised the yield potential. He said in a post:
“Yohank has just found a way to convert this into 95.9% APY to $ 100 million TVL and 19.18% for $ 1 billion+”
Cronje has not announced any specific details about the algorithmic mechanics of the stablecoin, collateral support or checks on chains. However, the yield curve implies a variable speed on the basis of liquidity levels.
In addition, the yield model suggests a scalable stimulation mechanism in which early adopters are rewarded with a higher efficiency, which gradually normalizes as the liquidity becomes deeper.
A market of $ 230 billion
Sonic, a high-performance Layer-1 network, positions itself as an implementing environment that is optimized for financial applications.
According to Cronje, the network is tailored to high-throughput and low-latency operations, which suggests that a stablecoin product could serve as a core component in its developing ecosystem.
The Stablecoin market recently surpassed $ 230 billion in total value, led by Tether’s USDTs $ 145 billion market capitalization, followed by Circle’s USD Coin (USDC), which has a market capitalization of $ 58 billion.
Despite the Dominance of USDT, newcomers are real competition in the sector, including Osde van Ethena Labs, who registered excellent growth in the past year.
Usde, which is also an algorithmic stablecoin, climbed from a market capitalization of $ 1.3 billion to $ 5.4 billion within a year.
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