Detaching RAI from Fiat: a price-oracle independent index

This post is meant as a follow-up to the overview of detaching RAI from Fiat and to propose a price-oracle independent solution to the index.

The world has changed since @stone’s post. By now it is becoming increasingly clear that governments see stablecoins as a threat. Coincidentally the EU started its investigation phase of a CDBC shortly after this post [0]. Some even speak of concerted attacks on stablecoin providers, aka Operation Choke Point 2.0 [1]. The task at hand for RAI to become independent of fiat is more relevant today than ever.

Coin Fair Value

One aspect of becoming independent of fiat is decreasing the reliance on a price oracle. Currently this is a USD-denominated ETH price feed. It would be great if this attack vector could be removed.

Luckily on-chain statistics alone are indeed sufficient to calculate the value of a currency without the need for any market data. I will cite pablompa [2] from his great publication: For the first time, thanks to the blockchain technology and to this model, it is feasible to calculate the fair value of a currency. I will show that without making use of any market data at all, one can estimate the price of a blockchain currency in terms of another and the error be very small [3]. This price-oracle independent index proposed here is called Coin Fair Value. It solely depends on on-chain metrics [4].


[2] pablompa (Pablo MPA) | Keybase
[3] Cryptocurrencies - What is the fair value of a currency? — Steemit