Hydrated DollarPrice

(HOLLAR)

HOLLAR is Hydration's decentralized, over-collateralized stablecoin. Its primary purpose is to maintain a stable value, approximating one dollar, by being minted against various crypto collateral. It offers users a stable asset within the Hydration ecosystem, addressing the need for price predictability in a volatile crypto market.

Users mint HOLLAR by depositing crypto assets, such as DOT, ETH, or tBTC, as collateral. There's a specific loan-to-value ratio they must adhere to. The minted HOLLAR represents a debt position that accumulates interest over time. To retrieve their deposited collateral, users must repay the minted HOLLAR amount along with any accrued interest.

HOLLAR leverages Hydration's architecture as an app-specific DeFi blockchain built on Polkadot, enabling deep protocol-level integrations and automated behaviors not feasible with standard smart contracts. It features a HOLLAR Stability Module (HSM) for advanced price stability, utilizing real-time market monitoring. Additionally, it implements automated partial liquidations at the start of each block to manage risk efficiently, differing from traditional all-or-nothing liquidation systems.

HOLLAR builds upon the battle-tested architecture of established protocols, inheriting robust mechanisms for collateral management, interest accrual, and liquidations. For enhanced stability, the HOLLAR Stability Module (HSM) continuously monitors stableswap pools block-by-block, responding in real-time to market conditions. Furthermore, it incorporates automated partial liquidations at the beginning of every block, designed to proactively bring unhealthy collateralized positions back to safer levels, thereby mitigating systemic risk.

HOLLAR operates on an over-collateralized model, meaning every token minted is backed by a greater value of deposited crypto assets. Users provide these assets as collateral to mint HOLLAR. An annual interest rate is applied to the minted HOLLAR, which compensates the protocol for the inherent risk associated with accepting volatile crypto collateral. This mechanism incentivizes responsible borrowing and contributes to the stablecoin's long-term peg maintenance.

HOLLAR is primarily available on the Hydration blockchain network. It can be traded on decentralized exchanges, with Hydration's own exchange being the most popular venue for its trading pairs. Its design allows it to provide a stable asset within the Hydration ecosystem, facilitating various DeFi activities that require price predictability without relying on centralized stablecoin issuers.