Zephyr is a revolutionary digital currency that combines the principles of privacy and stability. Grounded firmly on the proven Minimal Djed protocol, Zephyr embodies the first over-collateralized, private stablecoin, seamlessly incorporating the privacy features of Monero into a stablecoin system. The Djed protocol, which draws inspiration from AgeUSD, is a collaborative brainchild of Emurgo, IOHK, and the Ergo Foundation.
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In simple terms, Zephyr Protocol works as follows. Users can mint or redeem stable (ZEPHUSD) and reserve (ZEPHRSV) coins in exchange for the base coin (ZEPH). <blah blah blah blah blah blah blah blah blah>
As they say, if you can't dazzle them with brilliance, baffle them with bullshit. That witticism is perfectly exemplified by the jargon brick above.
It's also said: ask a stupid question, get a stupid answer. But I'm just wondering about the nature of this "over-collateralized" stablecoin. Correct me if I'm wrong, but in perfect world stablecoins are supposed to be backed 1:1 by whatever underlying currency they represent--or at least should have their price pegged to the price of said currency. If you create a token system that essentially makes the stablecoin
more valuable than the pegged currency by the simple fact that it is indeed over-collateralized, would the token (the stablecoin) not then just become a token that just
sort of resembles the pegged currency, because its value will float based on the level of collateralization?
Again, I could be the stupid one here but I'd like an answer anyway.
