Why KUSD?

The KUSD stablecoin has various benefits:

• Interest-free borrowing: vault holders don't have to worry about interest fees lowering their collateralization ratio and eating away at their profit margins. Instead a small, one-time fee of 0.5% is charged upon deposits, ensuring that 1) anyone can participate in DeFi regardless of the size of their portfolio and that 2) costs are transparent and don't accrue over time, making it significantly more attractive to maintain your position even in worse market conditions.

• Governance-free policy and algorithmic stability: Unda has no governance token and its smart contracts are immutable. The price stability is ensured by its liquidation mechanism and arbitrage opportunities by vault holders. Vault holders are incentivized to repurchase KUSD and repay their loans if its market price drops below $1, pushing the price towards the peg. Conversely, if the KUSD price increases vault holders profit by minting additional KUSD and selling it on the open market, pushing down the price. The fact that no fees are charged for minting or repaying, nor any gas fees, makes high-frequency arbitrage trading attractive even at tight spreads.

• Non-custodial: users have total control over collateral assets at all times as long as a vault holder's minimum collateral requirements are met.

• Maximal flexibility for vault management: after depositing collateral no additional fees are charged. Vault holders are free to mint KUSD, repay their loan and withdraw collateral as they see fit without having to worry about gas fees. Managing a vault is frictionless and feeless, even in volatile market times.