An in-depth look at the Olympus Dao protocol and the not so stable stablecoin Ohm-Defi

in mid -October, Bitcoin.com news about how decentralized finances (defi) or algorithmic stable coins received considerable demand in 2021. Floating currency, which is only covered by what is held in the Olympus Dao State Cash. Ohm is not covered in the usual way by a US dollar, but the market assessment of the stable coin of 3.6 billion US dollars makes it the fifth largest crypto reserve currency after market capitalization.

get to know Olympus dao: an algorithmic monetary protocol

When stable coins were introduced for the first time, a centralized model appeared in which a blockchain network is used to distribute tokens that are held by a tested third party with Fiat support. The centralized model still exists today and the two best stable coins in relation to the market evaluation, usdt and usdc are Perfect examples of this type of model. Recently, decentralized finances (defi) or algorithmic stable coins have appeared, as the DAI from Makerdao.

makerdao is a decentralized autonomous organization (dao) based on Ethereum, which publishes the stablecoin dai, which essentially by a mix of oversured loans and the repayment system from Makerdao. Daos are basically frameworks that are coded from Smart Contracts and network participants influence the motifs of the organization. Makerdao enables loans and spends a token without intermediary that is linked to the price of the US dollar.

After the success of Makerdaos Dai-Stablecoin, a large number of decentralized stable coins join the crypto economy . Coingeckos "Top StableCoins according to market capitalization" show that a large number of these blockchain-assets such as the US dollar are placed. A project called olympus dao a completely different reserve currency protocol developed, which the Ohm-token . In contrast to DAI or USDC, which are linked to the value of the US dollar, the reserves of Ohm are crypto-assets that are held by the Olympus Ministry of Finance.

The Olympus dao-Team presented the dao on 1. February 2021, And the intro-post explains that the project is different because it is a freely floating currency supported by the Ministry of Finance. "Every ohm token is supported by 1 DAI in the treasury," explains the Olympus Dao introduction. "However, token cannot be shaped or burned by anyone. The protocol only does this in response to the price. If ohm under 1 DAI acts, the protocol buys back and burns; when ohm acts over 1 DAI, the protocol is shaped and sells new Ohm." The project's intro blog post adds:

Olympus dao participants can interact with the governance model of the project, pile ohm , as well as a strategy called connection . The first recorded value of Ohm on May 23, 2021 was around $ 162.79 per ohm. Since then, the value has increased by over 540% and today a single ohm exchanges hands for USD 1,057 per unit. The market capitalization of the crypto asset Ohm is around 3.6 billion US dollars and the number of ohms in circulation has risen by 120% in the last 30 days. Statistics show that at the time of writing, a global trade volume of 126 million ohms and 3,517,713 ohms are in circulation.

Olympus Dao sees pyramid accumulations, security gaps in smart contracts, price crashes and problems confronted with regulatory authorities

While many supporters say that the people should not be released ohm and the Olympus Dao, and some describe the first "Docentral Central bank ", others have called The project a pyramide or Ponzi scheme . Still others have complained about the volatility of Ohm, and although Ohm aims to be a stable coin covered by government bonds, price stability is not the ultimate goal. An OKEX academy Blog entry on the subject of the Olympus dao, a variety of risks discussed to which the project It could be exposed to how weaknesses in smart contracts, price crashes and regulatory problems with governments.