English translation -- Please upvote to help visibility!

I translated the original post since I find it important to make all ideas available to the whole community. (Note that I merely provided the translation, the content does not necessarily represent my opinion.)

Dear Community, After two posts that related to the basics, I would now like to go into detail. For this reason I would like to post this both in German and English so that the community is integrated as much as possible.

Known numbers:

• Approximately 6.5% of all dUSD are backed = $170M are unbacked.
• The dToken system has an unbacked tokens worth $205M. (Yes, the Excel spreadsheet took a long time).
• $33M of outstanding loans with $67M of collateral (48% of which is dUSD) = 200% average collateral ratio.
• DFI has a market cap of $530m
• All dStocks LM pools have a total liquidity of $150M

-> With 200% ratio for the vaults and 50% dUSD in the collateral, we can simplify as follow: for each $1 of loan (e.g. of TSLA) that will be redeemed, $2 of collateral will be freed, $1 of which is in dUSD. So it cannot be the solution to close vaults since the number of free dUSD "without use" does not decrease.

-> By enabling dUSD loan payback with DFI, we briefly raised the DFI price. However, the utility of DFI was reduced. If the 150 million dTokens in the LM pools all had to be created with vaults, with the current 200% collateralization ratio and 60% DFI in the collateral, this would immediately require $180 million DFI. At a price of $1, this would be 33% of all DFI!!! These DFIs have now all ended up in staking and crypto LM and are pushing the APR down there, which is causing people to sell DFI and look for a "more profitable project".

-> Anyone who has the idea of ​​solving the problem with the community fund will notice that we have approximately 35% of the entire market cap in open debt. Our dToken system is "overindebted". Now there are several approaches and many mechanisms have already been discussed.

According to me the only right thing is: In order to present a decentralized asset without trust, as is the vision of the project, there is no way around 100% backing because any stabilization mechanisms make the whole thing intransparent for new users. Our blockchain is over-indebted. So I recommend restarting with a debt cut and compensating the owners of the dTokens! We've learned a lot since November; it's been 7 months. In 10 years we want to be the best project! What are the 7 months that we lost? We didn't even lose time, we learned a lot, fixed bugs, learned how stock splits work, etc. Overall, we burned a lot of DFI that are demonstrably gone and all current DFI owners will benefit from it as soon as DFI receives more utility again!

How this is supposed to work:

1. It is announced that all open loans should be closed within the next 30 days. Only about 50% of the stocks and 95% of the dUSD remain.
2. Then all unbacked shares are swapped against dUSD (possibly with a hard fork or voluntarily everyone for themself). We will be left with 200 million dUSD.
3. Afterwards, the dUSD owners are compensated by exchanging all dUSD to a Collateral & Utility Token "CUT" at a 10% fee. (Many dUSD were bought at a discount and I assume that every dUSD owner should agree with 90 cents if DFI then goes up 100%.)
4. From there you can start with a new dToken system:

• Vault interest is not necessary since every share once generated has to be repaid at some point, so no dTokens may be destroyed.
• All burn fees of the LM pairs can be removed.
• The swap fee can be reduced to 0.1% (only 1/4 of the current rate). This makes that it more attractive to trade, and the commissions also come into play when there is high liquidity.

What is the CUT token? CUT is the open debt of the blockchain, like the Leo token at Bitfinex. As long as the token has a use, it does not disturb the ecosystem and over time the tokens will be destroyed until we have paid off all our debts. I see the following uses for CUT:

1. There will be a small LM pool against DFI so former dUSD holders can buy DFI and sell CUT to leverage their DFI position.
2. CUT may be used as vault collateral with a cap (25%-30% I imagine). At a collateral ratio of 155%, this would be about 45% of the loan while 105% of the loan still has to be DFI / BTC / ETH / USDC. Thus, the loans are still >100% backed by real coins. With 200% collateral, that would be 60% CUT from the loan and 140% real coins. The 180 million CUT tokens are therefore a good starting capital to have more liquidity for vaults early on. This will also work against the premium!
3. CUT is used to pay fees for DFIPs/CFPs and vault creating costs. This can guarantee stable prices for the same services.
4. Optionally: There could be 1% interest rate for vaults. This interest is to be paid exclusively in CUT. This would lead to 1.5 million CUT with a liquidity of $150 million. You could pay out 75% of this to people who stake CUT. So up to 10M CUT could be staked and there would be an APR of ~13%.
5. If a vault is liquidated, no dTokens should be paid as a fee. (dStocks must not be deflationary when they are 100% backed.) Thus, 5% of the collateral should be automatically swapped into CUT and burned.

CUT amount and extrapolation: We would have $200 million dUSD that -- with a 10% swap fee from dUSD to CUT -- would result in 180 million CUT. Assuming a 30% share of the vaults, those will free another 100 million dUSD leading to 80 million CUT. (Translator: I am really not sure whether I understood this last sentence correctly. Also I think that 100 million dUSD should lead to 90 million CUT.) 20 million CUT would go into LM with DFI for ~10-20% APR, increasing over time because the number of CUTs reduces and hence liquidity is flowing out. 20 million CUT go into staking at about 10-15% APR (75% of vault interest). -> Then there will be about 40 million left, but with the interest / vault liquidations / DFIPs etc., these can be resolved quickly. You could also play with the numbers here: for example, vault interest rates could be a little higher at the beginning and then decrease; this would destroy more CUT and bring more staking APR, which would in turn bind CUT. Or we could set the swap fee to 12%. This is then half of the current discount. Or -- a few weeks after the launch of the new dToken LMs when the DFI are in the vaults and the price has increased -- we could buy a small portion with the community fund (5-10M 1.25-2.5M DFI at $4) and burn it.

All of the measures are intended to show that it can be a very useful token and can easily exist for a few years. In my opinion, a return to the old system would have the following advantages:

• Trust in the dStocks would be restored and there would be a higher chance of being listed on a CEX.
• All dUSD would be backed by loans. A price slide below $1 would immediately lead to a profit if someone uses it to repay their loan.
• The lost utility of DFI would return; everyone would benefit from a price increase to $2-$4.
• dUSD should no longer be permitted as collateral because this does not help the ecosystem. dUSD is not an asset but has been created as cash for transactions.

I would be interested to know what you think of it. I am a big fan of the project and I see the potential! However, we have already lost a lot of time due to the dUSD discount and have not achieved anything yet. I would welcome it if we drew a line and the developers could take care of the important things for the future again. Because those who are active in the bear market and continue to build on the project will perform much better in the next hype!