The native stablecoin PUSD proposed by Gavin Wood has entered the proposal discussion stage

ChainCatcher news, according to official news from PolkaWorld, the Polkadot native stablecoin PUSD proposed by Gavin Wood has entered the proposal discussion stage.

It is reported that her basic idea is that block producers' rewards do not have to be distributed in the highly volatile DOT, but can be issued in stablecoins. Therefore, the Polkadot protocol itself (most likely on the Asset Hub) will issue a new stablecoin named PUSD, which will only be collateralized by DOT. The mechanism is similar to the HOLLAR stablecoin, where users can borrow PUSD by collateralizing DOT.

However, the community believes that if this stablecoin scales up significantly, it could trigger correlation risks. For example, a drop in DOT prices could trigger liquidations, and liquidations mean that DOT in the treasury must be sold.