The liquidity-providing ecosystem of Polkadot's "sister chain," Kusama, is going to be reshaped with its first stablecoin and a new rewards design. The major community-driven decision has passed.
First-ever stablecoin on Kusama: Introducing Karura Dollar (kUSD)
According to the official blog post by Acala's VP of Growth Dan Reecer, the proposal has passed to begin minting of Karura Dollar (kUSD), a pioneering USD-pegged stablecoin of Polkadot's Kusama.
Karura Dollar $kUSD minting, with $KSM collateral, is now live! This is the 1st stablecoin in the Kusama & Polkadot ecosystem. KSM/kUSD Bootstrap has begun, and the KAR liquidity provider reward program begins soon ⚡️
Mint kUSD: https://t.co/FYIvOV7LPXhttps://t.co/HPkldmDkyy— Karura - DeFi Hub of Kusama (@KaruraNetwork) August 6, 2021
KSM, a core native asset of Kusama, can be pledged as collateral for kUSD minting. The new stablecoin can be minted through Kusama Apps. The Karura Dollar (kUSD) is a fully decentralized multi-collateral stablecoin backed by cross-chain assets.
kUSD can be used in a variety of Kusama-based decentralized finances, as well as in retail use cases like payments, decentralized lending/borrowing and so on.
Also, a "Bootstrap mode" program is launched for KSM/kUSD liquidity pools. Liquidity depositors with at least 1,000 KSM or 10,000 kUSD are invited to participate in the program.
KSM/kUSD, KSM/KAR liquidity providers eligible for bonus programs
To ensure the rapid inflow of liquidity, the teams behind Kusama and Acala introduce limited LP rewards initiatives. KSM/kUSD and KSM/KAR pools will be the first ones to be included in this initiative.
A 50%+ liquidity bonus is implemented for KAR/KSM liquidity providers while 30%+ bonuses are introduced for KSM/kUSD liquidity providers.
As covered by U.Today previously, all liquidity initiatives across Karura and Acala are community-driven and approved by transparent referendums.