Exciting to see the launch of $FEI, a brand new type of #DeFi stablecoin:
๐ค Algorithmic
โ Governance-minimized
๐ Protocol Controlled Value
โ๏ธ Direct incentives
Learn more about it here ๐๐
Fei is a next generation stablecoin protocol. We are stoked to share this with the DeFi community! https://medium.com/fei-protocol/introducing-fei-protocol-2db79bd7a82bโฆ
This is pretty interesting - question: if the protocol held assets are USD-price volatile (say, ETH) aren't bank run scenarios possible when eth price dumps? And if the reserves are other stablecoins, seems underlying risks propagate to FEI?
Great question! The liquidity pools are naturally subject to price and technical risk of underlying assets. In the case of ETH volatility, the protocol handles undercollateralization gracefully although it could still be a failure mode in long term selloffs