Abstract

DebtCoin is a stablecoin I propose that is pegged to the U.S. national debt, serving as a transparent crypto token that tracks arguably the world’s most significant economic metric. It combines the stability of traditional stablecoins with a critique of U.S. fiscal policy.

Introduction

Stablecoins traditionally peg to assets like fiat currencies or cryptocurrencies. Algorithmic stablecoins often fail under market stress, while crypto-backed tokens are volatile. Fiat-backed stablecoins depend on centralized systems, contradicting crypto’s decentralized ethos.

DebtCoin provides a different approach. By linking its value to the U.S. national debt, it ensures stability, aligns with crypto’s transparency principles, and highlights the growing government debt.

DebtCoin offers:

  • Predictable pricing
  • Collateralized reserves
  • Transparent tracking of fiscal metrics
  • Usability for daily transactions

Implementation

Price Mechanism DebtCoin’s value is calculated as:
DebtCoin Price (USD) = Current U.S. National Debt / 10,000,000,000,000

So at $35.92 trillion in national debt, each token would be worth $3.59.

Oracle Infrastructure A multi-oracle system provides reliable price data, using sources like U.S. Treasury Direct and Federal Reserve Economic Data. Median-based calculations detect and exclude anomalies.

Reserve System DebtCoin ensures security and transparency with:

  • 100%+ collateral in USD
  • Real-time proof of reserves
  • Regular third-party audits

Minting Mechanism

Tokens are minted upon deposit and burned upon withdrawal, maintaining supply control.

Conclusion

DebtCoin combines strong security, reliable price feeds, and practical use. It critiques fiscal policy while offering features for yield farming, lending, and liquidity. DebtCoin aims to redefine stablecoins, blending functionality and transparency in an innovative way.

This is the first article in a 3-part series on DebtCoin:
DebtCoin: A Stablecoin Pegged to the United States National Debt (current)
DebtCoin: Reserve Management
DebtCoin: Governance Framework