0

I am trying to create a decentralized version of a money transfer service and I want to build it on the tron network. The problem I am facing is that I need each token to start selling for a certain price and I don't understand how trc20 tokens are valued on the tron chain. What determines the value of the token? How can I create my own version of a stable coin on the tron network?

Also, since my users are going to deposit cash in exchange for the trc20 tokens, what happens after all my, let's say, 100 million issued tokens sell out? Can I issue new tokens? or do I need to create a new token? I don't want to rely on the value of the token going up, it is supposed to act as a stable coin.

I have found that tether used consortium, but I don't get how can I do this while being hosted on the tron blockchain.

sorry if I made some mistakes, I am still trying to learn

This project is just for learning so I don't care about other alternatives doing the same. I am not building a business, I am just learning by building.

1 Answer 1

0

To begin with, I would highly recommend you to start your learning path from some other types of projects. Stablecoin projects are basically extremely complicated, and it's far from easy to build a new stablecoin.

The value of a token is simply based on its supply and demand. If many people want to buy the token, its price goes up, and vice versa. You can't issue 10 tokens and say that they are worth $1 each, since if nobody buys them, they are worthless.

There are at least two major types of stablecoins (or, stable tokens):

  1. Off-chain collateral. If the issuer wants to issue coins worth of $10, it has to keep an equivalent $10 of some real world assets (probably dollars) locked up in some verifiable place. This is a custodial and centralized system - Tether is a good example of this
  2. Algorithmic stablecoin. Uses complicated algorithms and game theory to keep the value pegged to something. Everything is on-chain. DAI is a good example of this.

Tether can just mint new tokens whenever they want. Users are basically simply trusting them that they only mint the correct amount, and that they have the same amount of collateral secured off-chain. DAI only mints (and burns) tokens based on preset algorithms, which can't be easily manipulated.

2
  • But how can they actually mint new tokens? I have read they use the omni layer for this, is this right? how can this omni layer issue new tokens or destroy them? is there an equivalent of the omni layer on the tron network? Mar 25, 2021 at 12:29
  • I have no idea what is omni layer. And I really am not an expert on Tether either. I also don't know what Tron has. Minting is simply functionality in a token contract - if it has been included there. Mar 25, 2021 at 12:34

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service and acknowledge you have read our privacy policy.

Not the answer you're looking for? Browse other questions tagged or ask your own question.