There was once a time when inflation was uncommon and hyperinflation wouldn’t exist, as governments could only increase the supply of money in line with the supply of gold reserves that they held. In the 50 years since the Bretton Woods system was dissolved, neoliberal and monetary policy have combined to deliver phases of tremendous growth, but at the expense of endless cycles of economic crisis, collapse, and chronic inflation.
The recent Covid-19 pandemic has had a devastating economic effect, but let’s not forget the fact that the global economy has been limping along under an increasing debt burden. In the US, for example, national debt now stands at a staggering $26.7 trillion. This addiction to borrowing is driven by weak economic growth, leading central banks to continually squash interest rates and engage in shady practices of monetary financing, also known as printing money out of thin air. This causes a currency’s value to depreciate and given the USD’s position as a world reserve, every currency is de facto depreciatory.
To combat the spiral of decline, we at MahaDAO set about a mission to correct this systemic flaw, tasking ourselves to design and create an asset that protects the buying power of the holder.
Introducing ARTH, a decentralized non-depreciating algorithmic form of currency, that ensures stability in buying power over time as opposed to stability in price. In this article, we outline the ARTH coin and its mechanism, but firstly what is MahaDAO?
MahaDAO: A new way
MahaDAO is a decentralized autonomous organization that is governed by the MAHA community. The MAHA token holders are at the helm of all decision making and play a central role in fulfilling MahaDAO’s true potential.
The MahaDAO ecosystem features 2 tokens: MAHA and ARTH.
MAHA: The governance token
MAHA, as the name signifies, refers to a supreme, magnanimous, greater than itself characteristic, which the MAHA governance token embodies. Community members use MAHA to vote on key aspects of the ecosystem in order to collectively manage the parameters that keep ARTH stable and in check. In short, MahaDAO is guided by the MAHA holders, who determine the various activities and updates within the ARTH ecosystem.
The primary responsibility of all MAHA token holders is to ensure the stability of the ARTH valuecoin.
ARTH: The valuecoin
ARTH is the world’s first valuecoin. Every time users stake their volatile collaterals in a CDP, they generate more value stable ARTH coins. ARTH is an absolute unit of measure that maintains the buying power of the token holder, irrespective of which direction the market moves and is backed by stable uncorrelated assets.
ARTH is a viable successor to stablecoins, which in themselves are depreciating as discussed earlier in this article.
What is a valuecoin & how does ARTH ensure its value remains stable?
Simply put, a valuecoin is a currency that is stable not in price but in value. As opposed to a stablecoin, a valuecoin never erodes its intrinsic buying power. If a cup of coffee costs 2 ARTH today, it would cease to cost higher in the future. It will cost 2 ARTH 5 years, 10 years down the line, if not less.
We’ve reengineered the reserve vault introduced by MakerDAO, with some key changes to create a valuecoin that maintains buying power rather than a stablecoin pegged to a depreciating currency. The vault acts as a regulator, managing the underlying collaterals locked in, used to generate and back the ARTH token.
