One of the main concerns that haunt digital finance’s history is monetary stability. Many people simply cannot believe that cryptocurrencies will be able to maintain effective value rates over time, and others just avoid it altogether, claiming it has too much risk for few benefits. The cost-benefit relationship between investors and tokens promises to evolve soon, as new projects like PieDao have a new approach to the way people manage their crypto-based assets.
Using collective governance strategies to make a definitive difference amid the industry, it allows users to invest in Bitcoin and Ethereum most innovatively ever, using cryptocurrency index funds.
A Brief Story About PieDAO
DAO is an initial for Decentralized Autonomous Organization. These organizations have a different system where rules are encoded as a fully transparent computer program, with shareholders controlling all processes, instead of a central authority or government-related third party.
Thinking of investing in PieDao? Be sure to read the project’s whitepaper before putting your money into any crypto project.
All its’ record of financial transactions is maintained in the blockchain ecosystem. The concept was born around 2013 and implemented for the first time one year later by Bitshares.
It has no conventional management structure whatsoever and is not tied to any particular country or state legal structure.
How Does PieDao Work?
PieDao is an asset allocation DAO for decentralized market-weighted portfolio allocations.
It works as a decentralized organization that allows its’ users to vote and influence on the creation and parameters of pooled index funds. These index funds are composed both by BTC and ERC20 tokens on the Balancer Protocol.
One of the main goals of the platform is to reduce risks associated with cryptocurrency markets. Although the risk is inherently part of the business, too much volatility is not suitable for investors as well.
So far, users have two options of diversification strategies inside the platform, choosing between two different indexes, BTC++ and USD++.
Investors who opt for BTC++ are diversifying their Bitcoin positions among equal weights of Wrapped Bitcoin (WBTC), synthetic Bitcoin (sBTC), pTokenised Bitcoin (pBTC), and Tokenlon’s imBTC, tokenizing BTC exposure on the Ethereum blockchain.
Thinking of investing into Bitcoin? Here’s a complete guide on how to buy Bitcoin with PayPal.
On the other hand, investors who choose USD++, are diversifying their USD position among Ethereum-based options like DAI, USDC, TUSD, and others.
The concept results from financial IQ combined with automated smart indexes. PieDao has its’ own native token, called DOUGH, used for governance purposes.
Anyone who holds DOUGH has the power of vote on any decision, which also includes foundational network, token sales to newcomers, and upgrades changes regarding allocations of the various crypto assets within the offered products.
This current DAO infrastructure came to life thanks to Aragorn, the well-known open-source project for the creation and management of decentralized organizations. According to Aragorn’s co-founder Luis Cuende, investing in PieDao is a dream come true.
Learn PieDao Jargon
The platform brought a revolutionary concept to the crypto market and community, indeed. Each index is called “Pie” by the platform’s jargon.
Each Pie has the power to hold its derivative tokens to gain more exposure to the underlying assets, and it also works as a source of liquidity for traders who want to swap between assets, which automatically provides rebalancing thanks to the Balancer protocol.
In mid-June 2020, the USD++ pool was launched, designed to hedge, and minimize risks associated with using decentralized Ethereum-based protocols.
Learn more: Ultimate guide on DeFi in 2020
The BTC++ pool was launched back in early April 2020. To start it, up to 65 Bitcoin has been locked within the protocol, with the pool being composed of four synthetic assets representing BTC based on Ethereum blockchain. It clearly shows the project’s concern of ultimately allowing traders the possibility of diversifying their investments with different options across crypto trading markets.
The platform has successfully sold out the first round of DOUGH token distribution, which means a lot, considering the platform was launched only a few months ago. Also, it already reached up to $3 million in total value locked.
How PieDao Impacts The World Around Us?
If we take a closer look at it, PieDao brought a brand-new governance system where users can both manage and monitor tokenized index funds.
By coordinating the creation and allocation of the tokens into “Pies” (platform’s asset pools), it plays a vital role as a DeFi milestone, accomplishing the mission of fulfilling the gap between DAO’s and decentralized finance.
Project offers innovation but does it have a bright future?
PieDao is a brand-new project launched this year (2020) that brought a new governance system where investors can manage, and monitor blockchain-based tokenized index funds.
The platform has its’ own particular dialect, referring to pools as “Pies.” So far, investors can choose between two Pies, BTC++ and USD++.
BTC++ it’s a weighed allocation between the different representations of Bitcoin on the Ethereum blockchain. On the other hand, USD++ it’s a stable coin pool, working as a weighed allocation among different Ethereum-based images of USD, such as DAI, USDC, and others.
The platform’s primary focus is to bring economic empowerment and technical accessibility for those crypto investors who want to gain exposure to tokenized positions without unnecessary or exaggerated risks, an essential aspect to further DeFi’s maturity.