SMARDEX, a decentralized finance platform funded by Swiss Web3 pioneer RA2 TECH, is announcing the launch of USDN after two years of intensive development and $12 million of investment. The platform's public seed round has attracted an additional $4.5 million in TVL in the immediate days after launching.
USDN is a synthetic dollar token backed by a fully decentralized ETH perpetual contract that - for the first time in crypto - delivers a Delta Neutral strategy. Addressing the vulnerabilities exposed by previous algorithmic stablecoins like Terra Luna, USDN will synthesize the stability of the US dollar using a tried and tested TradFi strategy that carries no risk of external counterparty liquidation. Unlike Terra Luna's volatile token approach, USDN utilizes ETH – the world's second-largest cryptocurrency – to create a novel structured product.
The core innovation lies in a mathematically precise Delta Neutral strategy that ensures those shorting ETH by minting USDN are always equally balanced by those going long ETH within the SMARDEX platform. This is controlled by a smart contract that ensures positions are always equally weighted. Critically, this approach prevents the systemic risks that plagued previous stablecoin models, ensuring there can never be a run on either asset.
For example, if ETH's price doubles, a long position earns 100% (double the value). Simultaneously, a short position loses 50%. The net result is no profit or loss in USD terms, because the gains and losses cancel each other out, creating a synthetic stable USD value. Ultimately this means that USDN will always remain linked to the value of USD $1.
Commenting on the launch of USDN, Jean Rausis, co-founder of SMARDEX, says: “We are creating a first-of-a-kind product with USDN and are excited to see immediate demand from investors. Experimenting with synthetic currencies has been taboo since the crash of Terra Luna. However, we have created a synthetic dollar that is fully decentralized without being backed by fluctuating assets.
Innovating beyond traditional yield mechanisms, secured by the Ethereum network, USDN will allow holders to earn yield on their dollars directly from their wallets, without the need to stake or deposit with a third party. This breakthrough allows USDN holders to generate passive income through an automatic rebase mechanism that increases balances seamlessly.
Demonstrating remarkable market validation, RA2 TECH has invested $12 million into SMARDEX's development. In November, the protocol governance opened a public seed round for USDN through a sub-token: sUSDN. The market response was overwhelmingly positive - less than 45 minutes after the announcement, over $1 million of total value locked (TVL) was seeded. Rapid adoption continued, with $3 million seeded within 24 hours.
Notably, sUSDN can be staked for a substantial yield through the website. This initial liquidity will serve critical strategic purposes, including launching the protocol, scheduled for release in January 2025.
"Backing a coin designed to be stable in value with an asset that can fall to zero - as Terra Luna did - is a recipe for disaster. In our case, the protocol position is Delta Neutral, which means that, for the first time – and without having to rely on centralized liquidity – you can have a token that's worth around $1, pays you interest, and is intrinsically resilient, powered by the SMARDEX ecosystem.”
Since September, thousands of daily users have been testing USDN through SMARDEX’s testnet. The project has also attracted the attention of leading auditors, including Bail Security’s Charles Wang, who in an X post, said that USDN is “one of the biggest innovations in the last years when it comes to smart contract development.”
Owen Thurm of Guardian Audits, which covers over $3.4 billion of the crypto ecosystem, has also given USDN his approval, stating in a recent X post: "Can confirm, the concepts are novel, the implementation is wizardry."
Founded by industry veterans and developed by a top-tier team sourced from the world's leading universities, both SMARDEX and USDN promise to be game-changers for decentralized finance, if not the wider cryptocurrency ecosystem at large.
About SmarDex
SmarDex is a cutting-edge decentralized exchange and automated market maker (AMM) that redefines DeFi with advanced features like Volatility Vaults, transforming impermanent loss into impermanent gains. Operating across multiple blockchain networks, including Ethereum, Binance Smart Chain, and Polygon, SmarDex offers low fees, seamless transactions, and staking opportunities through its native token, SDEX. Enhancing this ecosystem is USDN, a fully decentralized synthetic dollar designed to replace outdated centralized options, providing stability, transparency, and security. Together, SmarDex and USDN deliver a forward-thinking solution for maximizing returns and driving innovation in decentralized finance.For more information, please visit https://smardex.io/
Disclaimer: This content is provided by SMARDEX. The statements, views and opinions expressed in this column are solely those of the content provider. The information provided in this press release is not a solicitation for investment, nor is it intended as investment advice, financial advice, or trading advice. It is strongly recommended you practice due diligence, including consultation with a professional financial advisor, before investing in or trading cryptocurrency and securities. Please conduct your own research and invest at your own risk.
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