Inter Protocol has just dropped the news of its proprietary IST Vaults on the Agoric chain, via a recent press release. With the goal of making IST usable in the far reaches of the Cosmos universe, IST Vaults look set to launch Inner Protocol’s offerings to new heights.
Building on the base of functionality provided with the pre-existing Parity Stability Module (PSM) which provide the ability for users to swap stablecoins for IST, IST Vaults now enable interchain assets to be used as collateral to mint IST. At the moment, ATOM is enabled, with the community deciding future support for assets.
The moment we’ve all been waiting for has finally arrived — Inter Protocol’s Vaults are LIVE! 🎉
We’ve unlocked the gateway to the interchain by allowing you to lock up your $ATOM and mint $IST!
Get started on your journey through the #Cosmos 👉 https://t.co/H4PXkXyC6c pic.twitter.com/DbhNVKXMPM
— Inter Protocol (@inter_protocol) June 28, 2023
Inter Protocol Vaults: The New Order for the Agoric Ecosystem
Operating in an ecosystem which is increasingly vast and with ever increasing specialization of functions between chains, IST Vaults look set to provide the necessary inter-chain communication and functionality that Agoric required to scale efficiently. And as IST tokens serve as the primary mode of payment for Agoric network fees, the Agoric ecosystem as a whole will feel the benefits of Inter Protocol’s IST vaults immensely.
The Vaults themselves work in a distinct hybrid collateralization structure, which is split into two essential functions – The first, a basis of overcollateralization, where at the point of minting, the amount of assets requested in return for minting 1 IST exceeds the value of the IST. The second is that a reserve pool is built up, which adds a safety margin via purchase support in the event that IST becomes liquidated too rapidly for the market mechanisms to catch up. the combined result of both of these mechanisms makes for a robust token resistant to market shocks, truly embodying the principles of a stable coin.
IST can also be arbitraged, and traded back at a 1:1 exchange rate via the PSM. This way, via natural market activity, IST stays at parity with other stablecoins.
Dean Tribble, Agoric’s CEO said in a recent press release:
“IST is the stable token that the interchain economy requires: a native, extensible stable token backed by fiat, interchain digital assets such as ATOM, and future mechanisms as the economy enlvoles. Inter Protocol Vaults provide crypto asset holders a unique solution to generate liquidity while preserving their underlying asset position. I am excited about what Vaults does for IST, driving it forward to be the stable token of choice within the interchain economy.”
In addition to the above mechanisms, the stability of IST is supported too by the existence of the elected economic committee working in combination with the community – truly bringing full stakeholder control to the coin outside of any centralized entity.
Into the Future with IST
Zaki Manian, the Director of Decentralized Cooperation Foundation (DCF) is also excited about the potential of IST in light of the new Vaults feature, saying in a recent press release:
“The introduction of Vaults brings a host of new elements to Inter Protocol that enhance the scalability of IST. The integrated liquidation system and price oracle reinforce the groundwork laid by the Economic Committee and the previously launched PSM.”
We’re excited about the new IST features, and we’ll be keeping our ears to the ground for any additional comments or press releases from Inter Protocol – it certainly looks as though the future is bright future for IST. More on Twitter here!