I need help regarding stable coin, particularly like USDT and BUSD, pegged to US Dollar. I am working on a stable coin project. The smart contract needed to be developed in solidity and deployed on Ethereum network. I have done my research and so far the points i noted are;
- An ERC20 token contract will be developed with special permissions to particular wallet (Admin/Owner Wallet) for minting and burning tokens.
- The company launching the stable coin is responsible for managing the USD reserves against which the tokens are minted.
- Whenever a new user wants to get tokens, he will deposit an amount (in USD) to company reserves, and the company will mint equivalent amount of tokens for the user.
- Whenever a user wants to cash out (get USD for his/her tokens), his/her tokens will be burned by the comapny and equivalent amount of USD will be issued to user.
So far this is what i think how pegged a stable coin works.
Am I on right track or missing something.