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Digital Reserve Unveiled: DRC’s DeFi Platform for Hedging against Inflation Risks

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by Benjamin Godfrey · 3 min read
Digital Reserve Unveiled: DRC’s DeFi Platform for Hedging against Inflation Risks
Photo: DRC

Users who are interested in taking advantage of the product offering from the Digital Reserve (DR) platform can do so by depositing DRC into the system which will first be converted to WETH through the Uniswap router.

Digital Reserve Currency (DRC) has unveiled Digital Reserve, a decentralized finance-focused platform that has the core mantra of hedging against inflation. With the new platform, holders of DRC, which doubles as the network’s native token “will be able to get easy exposure to a basket of the most efficient store of value (SoV) assets to preserve their capital.”

According to a press release shared with Coinspeaker, the Digital Reserve platform is built atop the Ethereum Blockchain and offers value to its adopters based on their risk tolerances.

“The Digital Reserve will allow users to make instant deposits and withdrawals, keep track of their portfolio performance on the DRC website, and have multiple risk tolerance options for their portfolio, all while offering additional benefits such as secure storage and portfolio rebalancing to ensure users their portfolio is best optimized for the current market conditions,” the press release reads.

Digital Reserve is a new way that redefines the many unique use cases which abound in the world of decentralized finance. When fully launched, users can embrace either of the platform’s two portfolios including “Capital Appreciation” and “Capital Preservation.”

The Capital Appreciation option lets users grow their funds by exposure to Wrapped Bitcoin (WBTC), Paxos Gold (PAXG), and Wrapped Ethereum (WETH) in a ratio of 40:40:20 respectively. The Capital Preservation option has little exposure to risk with the components consisting of 90% USD Coin (USDC), 5% PAX Gold (PAXG), and 5% Wrapped Bitcoin (WBTC).

Post-launch, the DRC ecosystem will be adding other portfolios through community governance where DRC holders can vote for their favorite tokens to be added.

How the Digital Reserve Platform Works

Users who are interested in taking advantage of the product offering from the Digital Reserve (DR) platform can do so by depositing DRC into the system which will first be converted to WETH through the Uniswap router.

Depending on either of the portfolios chosen by the user, the WETH will then be divided by the portfolio assets’ allocation percentages and converted to those individual tokens. The new assets’ total worth is then calculated and minted as Digital Reserve Proof of Deposit (DR-POD) and will be featured in the DR Vault. The DR-POD is needed to reclaim the funds at any point the user deems it fit to liquidate their portfolio.

Part of the functionalities Digital Reserve will offer is the tracking of the performance of the portfolios in real-time. Additionally, it offers a rebalancing service, in which the cryptocurrencies are reallocated based on the percentages of the portfolio after the influence of volatility must have pumped or devalued some of the constituent digital assets.

Security of the System and Trust Factor

The Digital Reserve Currency smart contract has been fully audited by an independent body, Dedaub blockchain development firm with no traces of critical issues or associated flaws.

There are risks attached to using the platform as the cryptocurrency ecosystem itself is largely volatile. However, the project was created by Maxim Nurov, founder of Digital Finance, a Washington D.C. financial company that specializes exclusively in the digital assets market. Nurov, after releasing the tokens, took a role in the decentralized governing committee alongside 5 other elected members of the burgeoning DRC community. Together they formed a team that combined technical development skills, experience in the industry and a truly global perspective.

The platform places no obligation on anyone holding DRC to use the vaults. The token itself is built as a potential digital store of value with a limited supply and zero inflation rate. They are meant to appreciate in value over time, to the benefit of their holders.

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Benjamin Godfrey

Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.

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