Digging deeper: xUSD and DIKO

So how do Arkadiko vaults work?

Vault creators follow the steps:

Closing a vault

In order to get STX collateral back, a vault owner must revoke their STX being stacked in PoX first. Once a PoX cycle ends, the STX collateral will be unlocked. To regain the STX collateral, the owner will need to repay their xUSD debt plus their interest (called stability fees) incurred in order to withdraw.

How much xUSD can I mint?

The amount of xUSD you can mint depends on the amount of STX collateral you deposit into your vault, which follows a minimum collateralization ratio (200%) and maximum debt according to the following table:

Arkadiko collateral types

Moving on to the DIKO

DIKO is the Arkadiko governance token, which represents the cashflows of the Arkadiko protocol, included but not limited to stability fees and borrowing/lending commission fees.

  • First, stDIKO can be used to participate in governance voting to change collateral type parameters such as liquidation penalties, stability fees and debt ceilings.
  • Second, Arkadiko will buy up DIKO tokens from the open market using xUSD revenue from stability fees and burn the DIKO. We’re not saying DIKO has value… but there might an incentive to HODL ;)
  • 29% — Foundation allocation. Will be used over time to cover expenses and emergency funds.
  • 50% — Ecosystem allocation
    - 1.5 million rewarded to early vault owners in first 6 weeks of mainnet
    - 23.5 million rewarded through staking over the first 12 months
    - leftover ~25 million rewarded through staking over 4 years after
  • 21% — Team allocation, locked & vested over 4 years

Risks of Using Arkadiko

Risk 1

TL;DR

  • xUSD is a USD soft-pegged crypto-collateralised stablecoin
  • Applications that need stable value can start integrating xUSD to enable trading, lending, swapping, prediction markets, gaming, gambling, e-commerce
  • STX tokens are the collateral in Arkadiko vaults
  • Your STX token is interest bearing through PoX and will automatically increase your vault’s collateral value
  • Each collateral type has an independent debt ceiling
  • DIKO is the Arkadiko governance token
  • DIKO is staked for stDIKO
  • stDIKO is for voting
  • Excess stability fees are used to buy & burn DIKO
  • We will reward early users with 1.5M DIKO in the first 6 weeks. In addition, up to 23.5M DIKO can be earned through staking in the first 12 months.
  • Arkadiko is the oldest bridge on earth, located in Greece. LFG! 🚀

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Arkadiko Protocol

Arkadiko Protocol

Arkadiko Protocol is a stablecoin (USDA) built on Stacks to bring DeFi to Bitcoin.