Galaxy's Gyroscope Launches 'All-Weather' Stablecoin on Ethereum Mainnet

• Gyroscope Launches New Stablecoin GYD on Ethereum Mainnet
• All-Weather Stablecoin GYD Aims to Shield Investors
• Gyroscope's De-centralized Stablecoin Solution
• Who is GYD for?

Gyroscope Launches New Stablecoin GYD on Ethereum Mainnet

Gyroscope has recently launched their novel stablecoin, GYD, on the Ethereum$2,315 -2.42% mainnet. This comes after a period of successful testing on the Polygon$0.967 -3.65% network. The project is backed by investments from venture capital firms Galaxy, Placeholder, and Maven 11.

All-Weather Stablecoin GYD Aims to Shield Investors

The GYD, Gyroscope's all-weather stablecoin, intends to offer crypto investors a safeguard against stablecoin failures. The team behind Gyroscope asserts that the GYD serves as an effective measure to mitigate the risks associated with holding stablecoins, offering a form of 'automated risk control'.

Despite their name, stablecoins have been known to deviate from their price anchors. Notable instances of this include the temporary depegging of Circle's USDC - the second-largest stablecoin - following the collapse of banking partner Silicon Valley Bank (SVB). This event consequently led to a drop in the value of Maker$1,529 -3.93%'s DAI, as a significant portion of this stablecoin's reserve assets were held in USDC. Furthermore, Terra's algorithmic stablecoin UST saw a dramatic collapse last year, signaling the onset of the crypto winter. Moody's Analytics report noted over 600 instances of large-cap fiat-backed stablecoins depegging from their price anchor this year.

Gyroscope's De-centralized Stablecoin Solution

Gyroscope offers an alternative solution through its de-centralized non-custodial stablecoin, GYD. It is fully backed by reserve assets and utilizes an algorithmic mechanism to maintain its price pegged to $1. The token is designed to segment the risks of each backing asset by storing them in separate vaults. These backing assets are stablecoins placed in certain strategies like yield-generating sDAI and USDC in Flux, and also support automated market-making (AMM) strategies such as LUSD and crvUSD. The Gyroscope team has designed the reserve to accommodate a wide variety of strategies and assets as the stablecoin scales.

Who is GYD for?

The GYD stablecoin primarily targets decentralized finance (DeFi) users. It features risk diversification rules, new oracle and circuit breaker systems, and optimized minting and redemption bonding curves. All these guide the protocol on how to manage reserve assets for price stability, according to Gyroscope.

The launch of GYD followed a testing period on the Polygon network and the opening of its liquidity pools (E-CLP). These initiatives attracted almost $30 million in total value locked. Gyroscope's protocol raised $4.5 million in venture capital investment in a round led by Placeholder VC and Galaxy Ventures. Other participants include Archetype, Maven 11, Robot Ventures, Balancer Labs co-founder Fernando Martinelli, and others.

GYD is not a toy, but a stablecoin with aspirations to sit alongside Maker's DAI in the years to come, stated Chris Burniske, partner at Placeholder.

Edited by Jonathan Stoker