How asUSD balances to $1
The responses to mis-priced asUSD
asUSD maintains its peg through three independent mechanisms, each reinforcing the others, creating a system that gets stronger under pressure.
1. Predictive Rate Control
Preventing Deviations Before They Happen
The Innovation: Monitor Liquidity, Not Price
Traditional stablecoins wait for price breaks, then react. asUSD watches liquidity flows and adjusts the costs of borrowing to prevent breaks.
How It Works:
Pool Target: 50% asUSD / 50% USDC
Current: 60% asUSD / 40% USDC
Signal: Excess asUSD supply
Response: Rates increase immediately
Result: Price never deviates
The Math:
Error Signal = Target Reserve Ratio - Current Reserve Ratio
Rate Adjustment = Controller Function(Error Signal)
Time to Response: Next block (~2 seconds on Linea)
When $5M asUSD enters a $100M pool:
Reserve ratio shifts from 50/50 to 55/45
Controller detects 5% imbalance
Interest rates increase proportionally
Borrowing becomes expensive
Supply contracts naturally
Balance restores without price impact
2. Economic Arbitrage
Making Stability Profitable
When asUSD < $1.00
The Opportunity:
The Play:
Buy 100,000 asUSD for $98,000
Repay your Astera loan at face value
Your buying restored the peg
When asUSD > $1.00
The Opportunity:
The Play:
Deposit collateral to Astera Lend
Mint 100,000 asUSD at exactly $1.00
Your selling restored the peg
Why This Always Works:
No capital requirements (use flash loans)
Profit guaranteed by smart contracts
Someone will always capture it
3. Staking Reinforcement
Yield That Supports Stability
The Feedback Loop
How Staking Strengthens the Peg:
High Demand Scenario:
Flows to stakers: 20% APR
Result: Users buy asUSD to capture yield
Effect: Buying pressure maintains $1.00
Low Demand Scenario:
Natural equilibrium level
No artificial incentives needed
System finds balance organically
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