GMCash ($GMC) is an algorithmic stablecoin on Arbitrum pegged to the price of 1 GMX via seigniorage. GMCash is an algorithmic token protocol that operates on Arbitrum, making it the first algo-token with an Insurance Fund that uses collateral with a real asset. This innovative solution is designed to adjust the stablecoin’s supply deterministically, which moves the price of the stablecoin towards a target price, bringing programmability and interoperability to DeFi.
GMC holders can stake their GMC to receive gGMC, which is the GMCash Governance token. This token will allow users to manage the DAO Treasury and gain governance rights. GMC holders can use their tokens to vote on any proposals made by GMCash or redeem gGMC to receive assets from the Treasury. The surrender value of gGMC tokens will be calculated based on the circulating supply of gGMC tokens and will be fixed at the beginning of every epoch. Furthermore, all surrendered gGMC tokens will be burned.
How the Algorithmic Peg works
When GMC is below Peg
When GMC price is below GMX's Current Market Price (Peg), token holders can purchase GMC Bond (GBOND) and GMC will be burnt to reduce the circulating supply when users redeem GBOND tokens with a 1:1 ratio.
When GMC is above Peg
When GMC price is above GMX’s Current Market Price (Peg), the token supply will have to expand to push it back down to Peg and the contract will allow the redemption of the GMC Bond (GBOND).
