Redemption Mechanism

Redemption Process:

  1. Request: Users submit a request to redeem OUSD for underlying stablecoin reserves.

  2. Verification: The system verifies the OUSD balance and eligibility for redemption.

  3. Execution: Approved requests result in the user receiving an equivalent value of the reserve stablecoin, and the corresponding OUSD is burned.

Equations for Redemption:

Redeemable Stablecoins = OUSD Amount × Current Conversion Rate

Updated Reserve After Redemption = Initial Reserve − Redeemed Amount

Automated Checks

To protect against sudden redemption spikes affecting the system's stability, automated checks and balances will control the rate of redemption based on current liquidity and market conditions.

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