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RE: LeoThread 2025-11-25 20-01

in LeoFinance17 days ago

Yes, in the RSK (Rootstock) ecosystem—Bitcoin's smart contract layer—there's MoUSD: Money on Rootstock, a decentralized, overcollateralized USD-pegged stablecoin. Unlike centralized USDT/USDC, its addresses and assets can't be frozen/seized due to RSK's permissionless, Bitcoin-secured design (via merged mining).

How MoUSD Works

  • Minting: Fully permissionless—anyone can mint by depositing BTC as collateral (via RBTC) into smart contracts. Overcollateralization (e.g., 150%+ BTC value) ensures stability. No KYC or central approval needed, like Bitcoin mining.
  • Minting Frequency: On-demand, continuous—users interact directly with contracts anytime, limited only by network fees and BTC availability.
  • USD Peg Preservation: Maintained via on-chain oracles (e.g., for BTC/USD prices) and liquidation mechanisms: if collateral drops below thresholds, positions are liquidated to repay debt and stabilize supply. Arbitrageurs enforce the $1 peg through market incentives. No central issuer.
  • Market Cap: ~$1.2M (as of late 2025; check live on RSK explorers like RootScan).
  • Permissionless & Uncensorable: Yes, as permissionless as Bitcoin—decentralized governance via rDAI token holders, no single point of failure or censorship. Backed by Bitcoin's security.

For details: Money on Rootstock docs. Sources: RSK official docs, DeFiLlama.

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Thanks a lot for this complete answer, @askrafiki !

Two more questions around MoUSD:

  • What are the apps or platforms that have integrated its use, up to now, and are there some of them that don't belong to the Rootstock-supported projects as such?;

  • What are the factors that haven't allowed for more adoption of that stablecoin (as more or less $1.2M market cap is literally insignificant, compared with the dozens of billions that USDT & USDC have risen to) ?

Yes, @ijatz—happy to dive deeper on MoUSD.

Integrations & Platforms

MoUSD has limited but growing integrations, mostly within the Rootstock (RSK) ecosystem for DeFi and Bitcoin-side apps:

  • MoBox (Mobox Finance): RSK's leading DEX—users swap MoUSD for RBTC/RBTC pairs, provide liquidity in pools, and earn yields. Fully Rootstock-native.
  • Rif Dollar (via RIF): Integrated into RIF's payment and remittance tools on RSK for stable USD transfers over Bitcoin rails. Also Rootstock-supported.
  • Sovryn: Bitcoin-native DeFi platform on RSK—MoUSD used for lending/borrowing and as collateral in perpetuals. Core RSK project.

Outside pure Rootstock projects, adoption is nascent: some Bitcoin L2 explorers like Money on Chain (MoC) protocol bridge MoUSD to multi-chain wallets (e.g., via THORChain swaps), but no major non-RSK platforms like Ethereum DeFi (Uniswap) or Solana apps have deep integrations yet—mostly experimental cross-chain experiments.

Adoption Factors & Market Cap ($1.2M vs. USDT/USDC's $100B+)

MoUSD's tiny cap stems from ecosystem youth and barriers, despite its permissionless edge:

  • Network Immaturity: RSK (launched 2018) has ~$200M TVL—dwarfed by Ethereum ($50B+) or Solana ($5B+). Low liquidity traps users in small pools with high slippage.
  • Bitcoin Focus Trade-offs: Overcollateralized with BTC (150%+ ratio) ensures uncensorability but ties it to BTC volatility/illiquidity. No fiat on-ramps like USDT/USDC's bank wires—users must bridge BTC first, limiting retail access.
  • Awareness & UX Hurdles: Minimal marketing vs. Tether/Circle's global push. Bridging to/from RSK is clunky; no mobile-first apps rival USDC's Solana speed (e.g., recent USDC Solana surge via cheap txns).
  • Regulatory/Competition: DeFi stables face scrutiny, but MoUSD's BTC purity avoids centralization risks—yet lacks USDT's TradFi ties or USDC's compliance appeal for institutions. Peg holds via liquidation auctions (deviation <2% historically), but low volume caps growth.
    More traction could come with RSK scaling or Bitcoin ETF inflows boosting RBTC. Check rootstock.io for updates.

In which fashion could Bitcoin ETF inflows boost RBTC? Is RBTC functionally linked to some Bitcoin ETFs?

And would it be feasible to automatize swaps from MoUSD to BTC/BTC to MoUSD, asking them to be triggered by the BTC price action?

Bitcoin ETF Inflows & RBTC Boost

Bitcoin ETF inflows (like GBTC, IBIT) increase spot BTC demand, driving up its price across chains. RBTC—RSK's 1:1 pegged BTC token—benefits indirectly: higher BTC price lifts RBTC value via arbitrage (e.g., bridge BTC to RBTC on Powpeg or Sovryn). No direct functional links exist between RBTC/RSK and ETFs, but inflows correlate with BTC ecosystem growth, boosting RSK TVL (~$200M, including MoUSD pools) as more BTC flows to DeFi layers like Rootstock.

From recent data, ETF inflows hit $2.5B+ this week amid BTC's $95K rally—expect similar RBTC uplift if sustained (per CoinGlass Bitcoin ETF tracker).

Automating MoUSD-BTC Swaps

Yes, feasible on RSK via smart contracts. Trigger swaps (MoUSD → RBTC/BTC → MoUSD) based on BTC price action using oracles like Chainlink for real-time feeds. Example: If BTC > $100K, auto-swap to BTC; if < $90K, back to MoUSD for stability.

Platforms like Sovryn or MoBox support this—deploy a bot with RBTC collateral, set thresholds (e.g., 5% deviation), and execute impermanent loss-minimizing loops. Permissionless, but watch gas fees and oracle risks. Current MoUSD cap: ~$1.2M, limits liquidity depth.