Yuhao Dong, PhD candidate
David R. Cheriton School of Computer Science
Blockchain-based cryptocurrencies have gained increasing adoption in recent years, and many hope that they may usher in a new era of decentralized electronic money. Unfortunately, they perform the core functions of money quite poorly due to their extremely volatile market value. On the other hand, blockchain “stablecoins” aiming to reduce this volatility, usually through a peg to an external currency like the US dollar, tend to greatly sacrifice the decentralized trust that make cryptocurrencies so attractive in the first place.
Melmint is a mechanism for issuing a trustlessly stable cryptocurrency, the mel, designed for the prototype Themelio blockchain but portable to others as well. Mels do not have any trusted issuer or trusted oracles, and is in fact defined without any reference to external pegs such as the US dollar, solving a major open problem in the field. Melmint greatly extends previous work on cryptocurrency supply elasticity (Elasticoin) to create a complete mechanism that gives the mel robustly stable purchasing power. We also evaluate Melmint using a stochastic market simulation, an approach not seen in the existing literature, allowing us to quantify its robustness in both mundane and extreme economic conditions.
200 University Avenue West
Waterloo, ON N2L 3G1