ELI5 DeFi
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Seigniorage

These algorithmic stablecoins have no collateral backing and are based on game theory with financial incentives.

Pros

  • Decentralized
  • Early adopters get filthy rich

Cons

  • Early adopters get filthy rich
  • They don't seem to work ¯\_(ツ)_/¯
  • High risk money games
  • Large players ("whales") can greatly influence the market valuation

Examples

  • DSD (0xBD2F0Cd039E0BFcf88901C98c0bFAc5ab27566e3)
  • ESD (0x36F3FD68E7325a35EB768F1AedaAe9EA0689d723)