Designing Autonomous Markets for Stablecoin Monetary Policy | Devcon Bogotá

Summary

The video discusses designing a redemption curve for a cryptocurrency stablecoin to maintain its peg to the US dollar. It analyzes previous stablecoin designs and issues caused by discontinuous crashes. The proposed solution is an autonomous reserve-backed design with a smooth redemption curve that responds dynamically to market conditions. This aims to prevent speculation, enable long-term survivability, and provide transparency. Theimplementation uses a piecewise linear approach for tractability. Overall, carefully designing redemption curves can lead to more robust stablecoin systems.

Takeaways

• 😀 The talk discusses designing a stablecoin system and its redemption mechanism during times of crisis
• 💡 A key component is the Redemption Curve that determines payouts during redemptions
• 📈 The goal is to keep the redemption price stable for as long as sustainably possible
• 🔧 The system should be easy to use, with no incentives to game the mechanism
• 🎯 Key design criteria include continuity, long term survivability, and maintaining the peg
• 📉 Case studies of stablecoin designs crashing show the need for robust mechanisms
• 💰 Diversifying reserves and coordinating vaults can improve stability
• ⚖️ Governance can configure parameters, with the system reacting autonomously
• 🔀 The implementation makes the redemption curve dynamic based on market conditions
• 👍 Properties like path efficiency help the system recapitalize itself over time

Q & A

What is the goal of designing a redemption curve for a stablecoin?

The goal is to get good properties and robustness for the stablecoin system. It allows you to configure parameters like minimum collateralization ratio to prevent the system from crashing.

What are some examples of assets that could be used in the reserve of a stablecoin system?

The reserve assets could be things like USD Coin (USDC), equity shares, bonds, or a portfolio of other cryptocurrency assets. The gyroscope stablecoin uses a reserve of liquid assets.

How did the original design of the Fei stablecoin lead to problems with its peg?

Fei originally had direct incentives, which meant the more the overall system was depegged, the worse redemption price you would get. This created a very steep redemption curve that did not support the $1 peg for very long before crashing.

What was the main flaw in the design of the Iron and Titan stablecoins?

Iron and Titan had endogenous collateral, meaning the assets backing the stablecoin were tied into the project itself. This led to negative feedback spirals and abrupt crashes when redemption exhausted the market's willingness to buy the endogenous assets.

What are some desired properties for a stablecoin redemption curve?

Desired properties include: collateralization stays above a minimum level to enable recovery, redemption price stays above a minimum to support the peg, continuity to prevent speculation, ease of use without incentives to game the system, slow reserve exhaustion, and ability to regain the peg.

How does the presented stablecoin system make its redemption curve dynamic?

It observes the current collateralization ratio and redemption pressure at each point in time. Using those inputs, it reconstructs what the initial 'anchor' collateralization would have been if markets had not moved. It then applies the redemption curve model based on that anchor state.

What are some advantages of having an automated redemption curve policy?

Advantages include: no need for governance intervention during crisis events, full transparency for market participants to understand system behavior, and prevention of speculative attacks due to predictable policy.

How does the system provide incentives for recapitalization and survival over long term?

As outflows decrease over time, there is upward pressure on the peg and collateralization from earning yield on reserve assets. This allows the system to improve its state and regain trust after a depegging event.

Why use a piecewise linear curve instead of a smooth curve for the redemption policy?

A piecewise linear curve leads to easy numerical integration and solves for redemption amounts using simple quadratic equations. Smoother curves pose challenges for on-chain computation and implementation.

Why do we see a resurgence of stablecoins with pegs today versus free-floating cryptocurrencies?

Pegs to trusted currencies like the US dollar make it easier for people to adopt a new cryptocurrency economy. An autonomous peg system also allows more general types of monetary policy in the future if desired.

Outlines

00:00

🎤 Introducing gyroscope stablecoin design

The speaker introduces gyroscope, a stablecoin they designed with co-founder Arya. They explain stablecoins aim to maintain a stable price by allowing minting and redeeming against reserve assets. The talk focuses on the redemption mechanism for when the system becomes under-collateralized.

05:00

📈 The redemption curve concept

The speaker introduces the concept of a redemption curve to analyze stablecoin designs. It shows the relationship between redemption amount and price offered. Ideal curves stabilize at $1 but often drop sharply when reserves empty, allowing speculation.

10:01

⏩ Comparing historical stablecoin reactions

The speaker discusses historical examples of both fiat currencies and stablecoins losing their pegs. He highlights issues with the original Fei protocol design and reflexivity in algorithmic stablecoins like Iron/Titan.

15:04

🎯 Desirable properties for a redemption curve

The speaker suggests desirable properties for a robust redemption curve: maintaining minimum collateralization and price, continuity to prevent speculation, and ease of use. He then shows a simplified curve satisfying the criteria.

20:05

✅ Implementing the redemption curve on-chain

The simplified curve must be made dynamic to handle changing market conditions. By reconstructing initial state, current conditions can map to redemption prices based on an ideal curve encoded on-chain through encoded regions.

25:06

🛡 Redemption helps the system self-heal

The speaker concludes by reviewing useful properties of the new design. It disincentivizes gaming redemptions, and through buying time helps the system survive and self-heal long-term during crisis scenarios.

Keywords

💡stablecoin

A cryptocurrency designed to have a stable value, often pegged to a fiat currency like the US dollar. The video discusses design considerations for building a robust stablecoin system.

💡reserve assets

The assets held in reserve to back a stablecoin and ensure its value remains stable. The video talks about using a diversified reserve of liquid assets to improve stablecoin designs.

💡minting and redeeming

Allowing users to exchange assets for newly minted stablecoins or burn/redeem stablecoins to withdraw assets from reserves. This helps stabilize stablecoin value.

💡primary market mechanism

The on-chain system governing minting/redeeming of stablecoins. The video focuses on designing this to handle undercollateralization.

💡redemption curve

A curve plotting stablecoin redemption amounts vs redemption price offered. Analyzing this for a stablecoin design evaluates robustness.

💡undercollateralization

When a stablecoin's reserves fall below the value of circulating stablecoin supply. The video discusses policy reactions to this.

💡crisis situation

Severe market conditions like undercollateralization that risk destabilizing a stablecoin. The video focuses on designing policy to handle such situations.

💡feedback spirals

Destabilizing cycles where falling stablecoin value damages market confidence, spurring further sell-offs. Robust policy aims to prevent these.

💡forward guidance

Central bank strategy of clearly signalling future policy moves to shape expectations. This is discussed for restoring stablecoin confidence.

💡lines of defense

Multiple mechanisms in a stablecoin design to maintain value. Invoked sequentially as crisis situations develop to buy time for recovery.

Highlights

Imagine you want to build a stablecoin, you have a cryptocurrency and you want to keep it stable.

The goal of Gyroscope was to build something like a PSM 2.0, so how might you improve on this design?

Maybe we should think about the Redemption curve as a design problem and maybe we should choose a Redemption curve that we think is useful and reasonable.

You probably want some kind of continuity of that curve, you probably don't want these abrupt crashes.

We have implemented this in Gyroscope's Dynamic Stability Mechanism, Gyroscope is our new stablecoin launching towards the end of the year.

You can design your Redemption curves when you're building a stablecoin system. This is a very attractive way to get good properties of your system.

I showed you a design for one desirable Redemption curve and then I showed you how to make that Dynamic and make it react to market conditions.

Hopefully all these properties are going to make Gyroscope very robust.

If you implement the system your reserve does not crash completely to zero and people just come and redeem, then your system is going to recapitalize itself over time.

There's no incentive to split up redemptions and like mathematically that's because you're Computing an integral and you can always split up an integral in different parts and it doesn't matter if you compute the parts of the whole thing.

It seems to work well in those situations because people want to use a more trusted unit of account like a dollar.

The autonomous monetary policy that we've been developing can be more General than just maintaining a currency Peg.

You can choose parameters in different ways to do more arbitrary monetary policy too.

The idea is to buy the system time so that those other mechanisms might be able to kick in.

There's sort of a tendency to increase collateralization over time because of that.

There's upward pressure on the peg from the reserve assets again kind of according to this policy.

Transcripts

foreign

[Music]

and today I want to talk about some of

the design work we did for our stable

coin that's called gyroscope and there's

a joint work with my co-founder Arya

clagasmond

so imagine you want to build a stable

coin

so you have a you have a cryptocurrency

and you want to keep it stable and in

some senses it's always going to look

like this you have some kind of reserve

of assets

and then people can mint and redeem

coins against that assets

um and that's going to stabilize the

price right if the price is too high

they can

um they can meet new coins if the price

is too low they can redeem coins it's

going to stabilize the market price

um and we call the primary Market

mechanism excuse me the primary Market

mechanism the thing that grants access

to these assets and that intermediates

between

mintus and redeemers which are basically

Upchurch and the asset Reserve

um now what are these assets well that

depends on your design

um it could be many different things in

a sanyaraj shared design

it could be it's basically an equity

share in a sense

for something like a basis design it's

something like a bond and in a reserve

back design at some portfolio of other

assets and by the way this is a design

we are using for gyroscope it's reserved

backed

um

now there are different situations we

need to look at

um the kind of boring case is when the

system is fully collateralized and all

the assets are perfectly liquid because

then this is just basically a pricing

problem price the reserve assets

um and the somewhat more tricky case is

the system might be 100 collateralized

but not all of these assets might be

liquid so you cannot necessarily pay

them out when people redeem

um and then there's the crisis situation

where the system actually becomes under

collateralized and then you need to

decide what to do and my talk is going

to be about the design of this component

that basically designs what to do in

such a situation

um

what we are implementing for gyroscope

is a reserve of only liquid assets so we

are not really considering this case but

it would be a maybe straightforward

extension of what we're doing

so let's look at some examples of this

um if you look at die

you have the PSM or plexibility

mechanism and it basically looks like

this that your reserve almost only

consists of usdc and this is what people

sometimes say that dye has become or is

going in the direction of wrapped usdc

um

the the numbers are like 60 or like the

PSM usdc then you have another 20 of LP

shares against usdc and of course in

that situation

um something you need to ask is are

there many risks associated with that so

for usdc for example there could be some

regulatory risk which may amount to

counterparty risk censorship risk and so

on

um kind of the goal of gyroscope was to

build something like a PSM 2.0

so how might you improve on this design

and I think there are like two ways the

first thing is you may want to diversify

your reserves you may not want to hold

only usdc

and the second thing is to implement

something like a programmatic risk

control that reacts autonomously to

market conditions so that that kind of

can be seen in two parts the first one

is if you have indicted different PSM

vaults are independent

um but you probably want to coordinate

them somehow to react in the same way to

Market strategies

and the other one is

um to price the stable coin depending on

market conditions especially when the

system should the system become under

reserved

and this is kind of where we're going

so kind of to to build such a system

there are like many different challenges

and I just want to give you like the

um the super quick overview

um basically we want picture right so we

have a reserve that consists of

different asset classes that are

probably structured in some way

and then you need to answer several

questions like which of these which

assets should that be which risks are

these exposed to how to structure the

whole thing so that the risks are

somehow contained

um how do you generate details on the

whole structure you probably want to

price these things with oracles and so

on these are all things I'm not going to

talk about but questions we still had to

answer for gyroscope and today I want to

answer

um this mechanism basically the question

is someone comes to your system the

system may be under reserved or illiquid

to some degree they want to redeem a

stable coin what is the amount of assets

you offer them

um and to do that we introduce a more

General tool which is what we call the

Redemption curve and this is a general

tool to analyze any stable coil design

basically

um so the Redemption curve is falling

curve you have two axes on one axis you

have the Redemption level which is

basically the amount of stable coins

that are getting redeemed and on the

other axis you have the Redemption price

that the mechanism offers to the

Redeemer and now we assume now we look

at what happens when people redeem more

and more in market conditions don't

change for the beginning so nothing

happens no prices change but people just

redeem more and more and ideally of

course what you want is this curve you

can always redeem at the dollar because

then you always stabilize your pack at

exactly a dollar

um and the higher your curvature here is

the less you support the peg as more and

more people redeem

um kind of the default that is also

happening for pack fiat currency is that

you try to support the pack as long as

possible until your reserve is empty and

then you don't support it anymore

and and kind of my argument will be that

maybe this Redemption curve is not ideal

and many other Redemption curves aren't

ideal either

so um we can see kind of this this type

of curve or that type of behavior in the

in the real world or in the Fiat world

um for example the attack on the British

pound in the 90s was basically

um a continuous outflow

um from the from the British pound

basically a continuous Redemption of

pounds against other assets until the

central bank was no longer willing to

support the peg

um and then you see this this kind of

drop where some people made a lot of

money

I think the recent crash of the pound is

probably not like that

I can't say anything about that

um if we look at if we look at stable

coins

we've seen similar behaviors the Strat

is a little bit outdated but there was

this period in like 2021 where like many

creative stable coin designs were

created and many of them crashed and in

a somewhat similar way very abruptly

um

I want to look at one like design case

study which would be Fey the original

design of Fae which was also not very

successful in its original form

um and so Faye had these direct

incentives which basically means

um the the more of Peck the whole system

is the worse the price you're getting

and that if you kind of look at it leads

to a Redemption curve that is very Steep

and that looks about like this which

means that your pack is not going to be

stabilized very long and then they

removed the direct incentives and then

their Redemption curve looked much much

less steep

um and we can see kind of the effect of

these like steep Redemption curve here I

hope this is kind of visible this is

like the price of a after launch

um and it had like a like a huge uh

price drop with a lot of volatility

um I should probably talk about the the

elephant in the room or maybe not

elephant anymore

um Sunny Road shares and the way I think

about Sanyo shares is essentially

um that you redeem at one dollar but

your backing is an endogenous asset

that's basically uh very very tied into

your project itself and this can lead to

some negative feedback spirals

[Music]

um

so essentially it's the same story as

from the Fiat world before

you provide Redemption at a dollar until

the willingness of the market to buy

your senior shares is exhausted and then

you basically crash very rapidly and I

should probably show this

um

right

um

the the Supply right here has this

Supply inflation at the same moment but

it doesn't really matter because people

don't want to the amount of senior

shares people want to buy doesn't

increase

of the amount of dollars people want to

put into senior chairs I should say

um I I should point out one thing about

this particular talk

this was when I gave the first version

of this talk this was not without

precedent we had a very similar system

uh called iron you may remember which

also crashed in a very similar way so

here you have the stable coin that

crashed at the same time the endogenous

collateral crashed also

um so so that that's not good and that's

why we made gyroscope Reserve pact

um

and

the basic idea of what I want to talk

about today is maybe we should think

about the Redemption curve as a design

problem and maybe we should choose a

Redemption curve that we think is useful

and reasonable and then we go and

Implement that in our primary Market

maker

um so the the basic design is going to

look like this right you remember this

picture

and we're assuming that the assets here

are exogenous so we don't need to worry

about these feedback effects but what do

you want to do if the system is under

collateralized or illiquid

um and we have like like I want to give

you these results in three parts

um first we thought about what are

actually disadrata for a good uh

Redemption curve what do we really want

and then I'm going to show you one such

curve that satisfies the Digital Data

and then I'm gonna talk to you about how

to actually Implement that because as

you remember the Redemption curve

assumes that no Market condition changed

over time and of course that doesn't

happen in reality so this step from

picking a curve and then implementing is

is making it Dynamic and this is going

to lead to this type of dynamic bonding

curve if you want to think about it like

that

um great let's first think about what we

would ideally want of our Redemption

curve

um first thing I want to I want to note

is that probably your collateralization

should be should stay above some lower

bound your Redemption shift Redemption

curve should not exhaust your reserve if

that's at all possible and the reason

for that is to enable the system to

recover later you if you exhaust your

reserve you're basically destroying your

your system

and that's bad and then you probably

also want the Redemption price to stay

above a lower bound if that's possible

to support the peg at least to some

degree

um of course this is Trivial we usually

want our stable count to be stable at a

dollar you probably want some kind of

continuity of that curve you probably

don't want these abrupt crashes and um I

would say that the main reason for that

is uh to prevent speculation because

these kind of discontinuous crashes are

something people could speculate on very

easily and that could also lead to like

all kinds of Market upheavals

um

and and then this is like a little bit

of a bonus but you want your Redemption

curve to be easy to use so probably what

you want is

um you want the execution if you redeem

a certain amount of a certain amount of

stable coins our stable coins can be

called dials I told you for that

um you probably want that to be easy and

especially you don't want there to be an

incentive to subdivide your redemptions

and to be somehow clever about the way

how people redeem

um we have like a few bonus desiderata

that are um with respect to like several

transactions or several blocks

um you probably want your the reserve

exhaustion to take a long time unless of

course you reserve just the scratches so

the system should uh also kind of think

about what what happens what happens

tomorrow what happens when the system

runs continuously

um you should be able to regain your

pack and of course you need to implement

the whole thing on chain

um ah yes the first math equation so

before I show you how we implement this

I have to introduce this nice equation

we assume that the Redemption pressure

is computed as a Time discounted some

if you don't care about that that's

totally fine

and now I'm going to show you one

simplified design that satisfies almost

all of the desireata

and this is a simplified Redemption

curve we're not using this but it's good

for explanation so what's a curve does

is that we support

a price of one dollar so people can

redeem at a price of one dollar

um

up until a certain amount of redemption

so on this axis we have redemptions

um

and then

we are gonna drop the Redemption price

so that the Redemption price is equal to

the collateralization ratio and this is

a sustainable way of doing it so for

example if your system is 80

collateralized the Redemption price

would be 80 cents and you can just do

that indefinitely and redeem the rest of

the money and of course this has all of

the nice properties almost all of them

um you don't run out of you don't run

out of Reserves

um you can actually configure a

trade-off that exists here of course the

longer you support a pack of one dollar

the lower your eventual

collateralization is going to be but

it's something that you can choose

um exactly so so we have like the

long-term survivability of the system

um because you might actually want to do

this like this would be like the

equation

um

but of course the problem is that this

is like this ugly discontinuous jump

that I mentioned before and so what we

really do is that we introduce a linear

segment there looks like this

um where the price would first be a

dollar then it would

decrease as more and more is redeemed

and then

um

if it if it has reached a point where we

have a sustainable collateralization

ratio it would just give you that price

um and if you want to do that the mouth

to do this looks like this

um but it's like it's fine right it's

fine they're like case distinctions and

fractions but it's not that bad

and one thing you you can see here is

that governance can configure this using

some hyper parameters so you can say

what is the minimum collateralization

that I want of my system

um and this is something that governance

would set because it's actually a

meaningful parameter you can say

um what is the steepness here that I'm

willing to tolerate another parameter

and then if you solve this equation it's

going to respond autonomously to these

type of parameters

um

now this curve is beautiful

but it has a problem it's not very

useful because it doesn't reflect

reality because we assume there is a

Redemption pressure of zero

um we have some kind of initial

collateralization of the system which we

call an anchor rate or we could we label

this like ra

um

and then you start from there the curve

tells you what happens when you start at

zero Redemption pressure at the anchor

rate nothing changes in the market

to implement that

we need to live in a situation where the

market will of course change and we can

still use this curve and this is what

I'm going to talk about today

so the goal is make the whole thing

dynamic

um make it react to the current market

state

and

I'm gonna show you how to do it

hopefully in a picture

and how we do it goes as follows

I showed you this curve

and if you know your anchor

collateralization which is on this axis

and you know a certain amount of

redemption pressure

and you can go and integrate the curve

from before and it's going to tell you

what your collateralization at that

point is going to be and that's up here

um

and now if we do that for all possible

sorry anchor values we get a

three-dimensional surface

um

and

what we just discussed was if you know

this and this you can compute this but

it turns out that you can also do it in

reverse so if you know the current

collateralization of the system on this

axis and the current Redemption pressure

here which is something that you can

just observe in in real time

then you can actually compute this

initial collateralization ratio which of

course at this point is a purely it's

purely a modeling tool but it tells you

if nothing had happened in the market

and we are now at the state where should

we have started if this model was true

okay so so many complicated words here

um and so basically this theorem says

that you can reconstruct that it's a

monotonistic argument

um it's it's fine

and and so then once you have the

initial State we can offer Redemption

prices

um based on uh based on this Redemption

curve as a model

um and that's pretty convenient because

it's a way to respond to current market

conditions it's completely autonomous

governance only has to set meaningful

hyper parameters it doesn't have to do

anything in the moment

and it's it's completely predictable for

other people so everyone knows what's

going to happen so yeah this you have

this huge transparency advantage over a

system where governance would just come

in and then make a vote and of course

other Market participants have no idea

what the outcome of this vote is going

to be

now I should probably talk about

implementation because you might be

looking at the theorem and you're like

yeah this is great if you're doing pure

math

but we're not doing that at all and I'm

going to talk a little bit about

implementation

and the implementation works in two

steps the first like core idea is that

um you saw you remember the scary slide

I showed you before with like many

formulas where everyone in the room

gasped so that had a couple cases

stations in it and if you do like the

cross product of all the case

distinctions you end up with a bunch of

regions and you can partition

your space into all of these different

regions and so you may believe me that

this is possible the theorem is that you

can actually detect in which region you

are based on only the current market

state

um and then it turns out that once you

know in which region you are

um Computing like this value on this

axis is very easy it's basically solving

quadratic equations then

um and that brings us to the algorithm

so we detect the region based on the

current state we reconstruct the anchor

State we take that as a model and we

compute our Redemption amount which is

basically integrating over this exact

curve I showed you before

and then when you like are being very

careful and you count all the things you

have to do to get this is actually very

cheap you just need to do some

arithmetic a little bit square root

um right so this system has a number of

interesting properties and I'm going to

show you just just like two

um

one result that you get like very easily

is that there's no incentive to split up

redemptions and like mathematically

that's because you're Computing an

integral and you can always split up an

integral in different parts and it

doesn't matter if you compute the parts

of the whole thing

so mathematically it's not very

interesting

[Music]

um

you have a path efficiency result which

is basically that and this is like a

little bit more interesting that the

protocol state is going to improve over

time so if you implement the system your

reserve does not crash

um completely to zero

um and people just come and redeem then

your system is going to recapitalize

itself over time and of course this is

exactly what we want we want long-term

survivability of the system

and

this is what this looks like

and now I want to conclude

so if you're taking away anything from

this talk it's that you can design your

Redemption curves when you're building a

stablecon system

and this is a very attractive way to get

good properties of your system it's also

a very useful tool to compare different

stable coins and to think about if the

stable coin design is actually solid

I showed you a design for one desirable

Redemption curve and then I showed you

how to make that Dynamic and make it

react to market conditions and if you

want to kind of be be involved into how

we actually do these things we have

implemented this in gyroscopes Dynamic

stability mechanism gyroscope is our new

stable coin launches planned towards the

end of the year

um and hopefully all these properties

are going to make a gyroscope very

robust if you're interested in the paper

and you should scan this QR code and if

you want to get in touch with us you can

go here or follow us here why did you

guys choose a like a piecewise linear

approach for example and not something

that's really smooth like a sigmoid or

something like that are there nice

properties that you get out of the this

then you would not get otherwise yeah

let me just just jump back to the slide

so the

[Music]

should I give the honest answer or the

line no I'm going to get the answer so

if you're honest answer is because it's

easy to implement

um because and like the reason is that

this is linear so it's integral it's

quadratic and solving quadratic

equations is easy and solving anything

else is is hard so I have more of a

philosophical question in the last let's

say two or three centuries the tenancy

in the state-backed currencies has

always been to leave Beijing to go

toward the free voting money why do you

think that in the crypto economy we are

seeing a Resurgence of Peg money that

seem to be quite prevalent

yeah

yeah that's that's a deep question I

wasn't expecting that uh

um why why do we have a Resurgence of

packed coins

um

I think my intuition is that

people think in USD or in some other

fiat currency that is not really

represented in crypto maybe at some

point we have a crypto native currency

um that that doesn't need a pack because

it's very stable against other Fiat

currencies

but I think we're not there yet and

that's why we need to represent some

some kind of measure some kind of

numerator that people are familiar with

and that matters in people's lives yeah

let me just add a little bit to that so

uh it's a common strategy when you're

kind of like developing a new economy to

do something like a currency Peg and it

seems to work well in those situations

because people want to use a more

trusted unit of account like a dollar

and so I think that's has a large

influence here but I also just want to

note that the uh the autonomous monetary

policy that we've been developing can be

more General than just maintaining a a

currency Peg you can choose parameters

in different ways to do more arbitrary

monetary policy too

I would want to know how do you think

about once the system gets under thrust

and you you get to the Redemption price

like what would be the the mechanisms or

the incentive to because it's kind of a

uh I think there is some loss of trust

in the Market at that point

how do you how do you think about how to

regenerate a system and and getting back

to the pack

like this

yeah so that

the gyroscope design contains a number

of other uh like lines of defense and

sort of ways that uh that the reserve

could replenish over time and so

basically this monetary policy the idea

is to buy the system time so that those

other mechanisms might be able to kick

in some examples of that is basically

like reserve assets are deployed in Risk

segregated ways but they can still

potentially earn some yield and so

there's sort of a tendency to increase

collateralization over time because of

that and then there's also sort of this

idea of forward guidance from the the

the monetary policy itself like

basically the as the out level of

outflows this like time discounted sum

that Stefan was saying decreases over

time then there's upward pressure on the

peg from the reserve assets again kind

of according to this uh this policy and

then there's other mechanisms too you

can check it out in our docs and happy

to talk more after after this as well