sFOT is an experiment of a different approach to stable coins. Unlike common approaches, sFOT is designed to put forward the users’ effect and to limit the price restricting/fixing precautions. Thereby, as stabilization will organically be made by arbitrageurs instead of fully by an algorithm, the goal is to establish a means to profit for arbitraging users, and to create the first stable coin that is fixed by the communal consensus and is free from centralized authority and from a move restricting algorithm.
Current situation of sFOT:
Fortis Oeconomia and the sFOT Protocol are designed on the basis of all users making the choices that produce the maximum profit. We must admit that as we engineered this design, we did not consider the possibility of users making less profiting or more harmful choices. The current de-pegging problem of sFOT is essentially due to some users’ choices to follow non-optimum, less profiting ways.
The idea that was put forward by some users that, ‘’instead of selling bFOT in junoswap, it made more sense to sell bFOT as FOT->bFOT->gFOT->sFOT->UST’’, created a massive misunderstanding. This led users to sell their bFOT over UST with 30% damage, and in this process harmed sFOT peg in a way that is very difficult to restore.
Although it is not important from whom the idea came from, this whole situation showed us the necessity for users to have in depth knowledge of the system for a stable coin backed by communal consensus to work; and illustrated the harmful consensus-breaking effects of a flawed idea.
Despite the solutions presented and adopted by the community for the solution of sFOT peg problem, the fact that the flawed idea disseminating among users that led to this problem is still present with some users still following the same flawed way and expecting different results has showed that a full solution in these circumstances is not possible and that all the precautions can only serve to delay the inevitable ending.
The only way to solve this problem is to inform users of the optimum moves and reengineer the design while considering the possibility that users may not always make the optimum choice and that sometimes they can make moves that are not in their best interest
Considering that re-pegging of the sFOT is unlikely and even if the problem is solved for today it is likely to occur again, we recommend reinterpreting the sFOT (de-connection of sFOT from modules and making it self sovereign dex lives inside the castle as a Castle Marketplace). This suggestion may bring some problems to mind.
Will sFOT lose its value? Will this harm the system?
sFOT may lose some value at the beginning but it will be regained with new implementations of sFOT dex. This suggestion will not harm the system in the long term. However, there will be some short-term effects that will be fixed with the sub-systems. As this decision is entirely in the hands of the community, we as a team can only promise that after the reinterpretation of sFOT it will be given the attention it deserves and sFOT will be brought to a very different level. Current ideas on sFOT; building new modules for sFOT usage, changing some sub-systems meta to sFOT from bFOT, giving FOT community pool management rights to sFOT DAO, and making “sFOT dex” an incubator for all crazy defi ideas.
Nothing has changed regarding the sFOT upgrades, this article express team’s thoughts and future possibilities.