Minting $SUSD

Creating $SUSD, Solidus's synthetic dollar, is a smooth and efficient process. We use Solana's high-performance blockchain to provide a USD-pegged stablecoin. This minting system ensures $SUSD is 1:1 backed by deposited assets and stays stable through delta-neutral hedging. Here’s a closer look at how it works.

1. Asset Deposit

To start, users deposit supported cryptocurrencies like SOL, BTC, or ETH into Solidus’s Solana smart contracts. These become the collateral for $SUSD. For instance, you might deposit 1 SOL when it’s worth $100.

Anyone can do this, through two main ways:

• Permissionless Minting: Use automated market maker (AMM) pools (like Raydium) if you're a retail user.

• Direct Minting: Market makers or large entities can mint directly after KYC approval.

2. Atomic Hedging Transaction

When your deposit arrives, Solidus performs an atomic transaction. This means $SUSD is minted, and the backing asset is hedged at the exact same time. Thanks to Solana’s lightning-fast speed and high throughput (over 65,000 TPS), the protocol instantly opens a short perpetual futures position. This happens on a centralized exchange (like Binance or Serum) and matches the value of your deposit.

So, if you deposited $100 in SOL, Solidus opens a $100 SOL short perpetual. This ensures your portfolio remains "delta-neutral." It means your overall exposure to SOL’s price changes is zero, locking in the USD value at the moment you mint.

3. $SUSD Issuance

Once the hedge is active, the protocol mints $SUSD at a 1:1 ratio to the USD value of your deposit. For instance, a 1 SOL deposit (worth $100) results in 100 $SUSD tokens.

Minting costs are minimal due to Solana's near-zero gas fees (just fractions of a cent). Any minor slippage or execution fees are clearly shown in the transaction. Solidus doesn't profit from the minting itself; our goal is a user-friendly and cost-efficient process.

4. Backing Asset Management

The deposited assets (like your 1 SOL) are never held directly on the exchange used for hedging. Instead, they are kept safe in institutional-grade Off-Exchange Settlement (OES) solutions, through partners like Copper. These assets stay on-chain, and we only delegate them to exchanges for things like funding payments or settling profits/losses. This drastically cuts down on counterparty risk while giving you full transparency and control.

5. Outcome

The result? You get freshly minted $SUSD tokens. They perfectly match the USD value of your deposited asset, stabilized by the delta-neutral hedge. For example, if SOL's price later falls to $50, your $50 loss on the spot asset is completely covered by a $50 gain from your short perpetual. This keeps your portfolio's total value at $100, meaning each $SUSD stays at $1. This system lets users smoothly convert volatile crypto into a stable, usable dollar, all without needing any overcollateralization.

$SUSD minting showcases Solidus's dedication to capital efficiency and rock-solid stability. We harness Solana's speed and the vast liquidity of perpetual futures markets (over $65 billion in open interest) to build a scalable synthetic dollar. Whether you use AMM pools or direct channels, this process ensures $SUSD is easy to access, secure, and primed for integration across all DeFi ecosystems.