Pure.cash: More Than A Decentralized Version of Ethena

Pure.cash countdown begins: game-changing protocol launches within a week. The project is built on Ethereum and aims to revolutionize the crypto industry, offering more than just a decentralized version of Ethena.

Highlights

  • Pure USD (PUSD): A scalable, decentralized synthetic dollar.
  • LongOnly: A zero funding rate perpetual contract product.
  • Reverse Issuance Model: Airdropping 100% of the maximum token supply at Token Generation Event (TGE), followed by continuous token burns.
  • Fixed Price Burning Mechanism: A revolutionary innovation for token empowerment.

From a fundamental perspective, Pure.cash is a decentralized version of Ethena, employing a delta-neutral strategy utilizing perpetual contracts to issue the stablecoin PUSD. Backed by ETH with corresponding equal short positions, PUSD consistently maintains a delta-neutral status, achieving maximum capital efficiency with full crypto asset collateralization.

What sets Pure.cash apart is its dual functionality: not only does it issue the PUSD stablecoin, but it also integrates a decentralized long-only perpetual contract protocol. This integration enables Pure.cash to achieve permissionless minting and burning of PUSD without any third-party custody risk.

Furthermore, Pure.cash is expected to demonstrate strong profitability by integrating its own LongOnly perpetual contract product. This contrasts with Ethena, which deposits assets into CEX exchanges for hedging, resulting in unstable funding rate income and potential losses.

LongOnly’s Unique Advantage

The market has witnessed several attempts at creating decentralized delta-neutral stablecoins. However, they failed to achieve large-scale adoption, either due to the limited scale of third-party perpetuals or the lack of competitiveness in their own perpetual products. LongOnly distinguishes itself by completely eliminating funding fees while maintaining a competitive trading fee of 0.07%, in line with market averages. Users can hold ETH long positions as if they were holding spot ETH, with up to 10x leverage.

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Of course, the availability of free leverage isn’t limitless; it depends on the supply of PUSD. This characteristic positions LongOnly as a popular product that will experience ongoing supply shortages given robust demand. With the current market demand for long ETH positions exceeding $10 billion, and additional market demand driven by the zero funding fee mechanism, PUSD has ample market capacity in its early development stages.

Some may question how the LongOnly perpetual contract balances long and short demand (PUSD supply) without charging funding fees. The protocol achieves this by (1) allowing liquidity providers (LPs) to absorb temporary imbalances within their liquidity and earn trading fees, (2) implementing preset limits and a floating fee mechanism to prevent liquidity depletion, and (3) utilizing a PUSD supply cap and an Active Redemption Mechanism to maintain equilibrium as demand shifts. For more details, refer to Pure.cash official documentation. 

Reverse Issuance Model

The Reverse Issuance Model (RIM) is an innovative deflationary model proposed by Pure.cash to address the challenges of traditional token issuance in crypto projects. The distinguishing feature of RIM lies in its unique distribution mechanism: the token supply reaches its max at the Token Generation Event (TGE), after which tokens are continuously burned, and no new tokens can be minted.

$PURE Airdrop Allocation

$PURE is Pure.cash’s utility and governance token, with a maximum supply of 2 billion. 100% of the maximum supply will be airdropped to the community through the Genesis Airdrop. The target supply of the PUSD stablecoin is set at 1 billion during Genesis Airdrop.

The Fixed Price Burning Mechanism

The Fixed Price Burning Mechanism (FPB) is a groundbreaking solution introduced by Pure.cash to tackle the challenge of token empowerment in current DeFi projects. Pure.cash sets a DAO-adjustable Burn Price and continuously injects protocol revenue (35% of total trading fees) into the Burning Pool. This mechanism allows anyone to burn $PURE and receive assets from the pool at the fixed Burn Price.

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The FPB is fully implemented through on-chain smart contracts. Notably, what makes this mechanism special is that it not only continuously reduces the token supply through burning but also serves as a Floor Price Buffer.

PUSD Utility Incentives

To promote the sustainable growth and utility of PUSD, Pure.cash allocates a portion of trading fee income to the following key areas:

  • DeFi Protocol Integration: directly rewards liquidity providers who utilize PUSD within various DeFi protocols.
  • Ecosystem Expansion: incentivizes ecosystem partners, including exchanges and payment service providers, for incorporating PUSD into their platforms.

Conclusion

Pure.cash emerges as a pioneering project in the crypto world, introducing a suite of innovations that address key challenges in stablecoin and DeFi markets. By integrating a decentralized synthetic dollar (PUSD) with a zero funding rate perpetual contract (LongOnly), and introducing novel tokenomics through the Reverse Issuance Model and Fixed Price Burning Mechanism, Pure.cash offers a unique approach to sustainable growth and genuine utility. Furthermore, Pure.cash incentivizes actual stablecoin usage, potentially breaking previous adoption barriers. The time for change in DeFi has arrived, and this is where Pure.cash leads the way.

About Pure.cash Labs

Pure.cash Labs is dedicated to promoting infrastructure decentralization by building a secure, transparent, and scalable stablecoin ecosystem. Our mission is to transform the DeFi landscape through groundbreaking technologies, including our revolutionary stablecoin and perpetual protocol. Additionally, we are committed to bringing back the original spirit of the crypto community – openness and fairness for all – by revolutionizing tokenomics.

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