Price Stability
Profitable actions during different market conditions
Orcus Finance offers USD pegged synthetic asset - oUSD, which is backed in a decentralized manner. A decentralized manner means that every synthetic oUSD has collateral that is stored on the contract balance and is available for users’ operations in the protocol. In addition, synthetic assets are backed in an algorithmic way thanks to collateral ratios: Target Collateral Value (mint actions) and Effective Collateral Value (redeem actions). These ratios determine how much collateral and governance tokens will be used during users’ operations of minting and redeeming processes.

Off pegged conditions

oUSD < $1

If oUSD is under $1 peg, every user has a profitable and economically useful arbitrage opportunity: you can buy a cheaper dollar in order to sell/redeem it with the profit in the near future when the market maker will stabilize the price of the synthetic asset.

oUSD > $1

If oUSD is above $1 peg, every user has the possibility to make some profit on the price distinction: you are going to mint oUSD with the target price of $1, meaning that you are spending exact $1 of value, while the current true market price of oUSD is above $1. You are able to sell oUSD with profit and stabilize the synthetic dollar price.
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Off pegged conditions