Gold Standard DAO Litepaper (Updated)

7 min readOct 26, 2022

Terms Used:

GSD (Gold Standard DAO Token)
DeFi (Decentralised Finance)
APY (Annual Percentage Yield)
Yield Farm (A method of earning rewards or interest by depositing your cryptocurrency into a pool with other users.)
Yield Aggregator (A platform that helps crypto investors maximise passive income from yield farming.)
DApp (Decentralised Application)
DAO (Decentralised Autonomous Organisation)
CBDC (Central Bank Digital Currency)
Cross Currency (Cross Currency is a term the GS team use to describe switching from different variants of stablecoins such as; USDC, USDC.e, DAI, USDT & others)
Cross Chain (A cross-chain is the capacity of two relatively independent blockchains to communicate with one another.)

Abstract

Decentralised finance (DeFi) is an emerging industry that promises to revolutionise the traditional finance sector. The need for an open, transparent, and secure financial system is the key driver behind the decentralised finance vs. traditional finance debate, so it does not come as a surprise that decentralised finance is slowly emerging as an alternative to today’s financial system.

The world of DeFi is actively developing. More and more people are showing an interest in decentralised finance — just look at the number of new startups, ecosystems and conferences. Countries are even beginning to implement cryptocurrencies as legal tender.

This new technology is unknown, engaging, and promising, but the most important reason for its rise in popularity is people looking for alternative ways to earn money (preferably remotely, with minimum effort), and store value.

Using DeFi is currently very complicated for inexperienced users due to the lack of a refined User Experience. Users need to understand how multiple blockchains work, which tokens are on which chains, where and how their yields are generated, etc.

As time goes on, this issue is being remedied. Bridges have become popular for moving assets across different chains, and in the future, users won’t know or care what blockchain they are using.

It’s time for cross-chain: a technology that the crypto market has been missing, until now.

Gold Standard DAO is one of the first automatic DeFi cross-chain yield aggregators to earn optimal profits on different blockchains and pay earnings in tokenized, vaulted, audited, insured, and verifiable gold bullion.

The Problem

Users who utilise yield farming services look for dapps on different blockchains that provide the highest returns. As a rule, such users have a complex farming system built: they look for pools on other blockchains, build the most optimal strategies algorithmically, constantly monitor the state of the crypto market, and transfer their liquidity when they discover a better location.

Inexperienced users are generally afraid of the words such as blockchain, DeFi, and token. These users need a simple and affordable solution that will introduce them to decentralised finance.

Farming was originally conceived as a passive income, however, with the advent of a large number of blockchains, platforms and various strategies, all this has become routine work. User is actively involved in tracking trends on different blockchains, determines the strategies, and calculates the risks. All this takes time — the most valuable resource in the world. We want to make DeFi easy again.

Value Proposition

Gold Standard DAO allows users to easily farm on multiple chains. They deposit their liquidity into Gold Standard DAO, which then performs operations that the user would normally do manually. Gold Standard DAO has incorporated protocols like Homora v2, BenQi, Beefy, etc. with specific liquidity pairs that are monitored.

If a user deposits, for example, some USDC into Gold Standard DAO, he deposits it in one place, and doesn’t need to worry about anything else. He doesn’t have to choose which blockchains to farm on or look for good yield, our protocol does it all for him. By aggregating multiple blockchains, the platform finds the best place to put liquidity to generate optimal profitability. If the yield falls by X%, liquidity is moved to another location that is more suitable. The platform also switches between different USD stablecoins like USDC, USDT & DAI. This is just one example of Gold Standard DAO’s functionality, and more complex strategies with various risk levels and returns will be added in the future.

See our roadmap for planned features.

Benefits to Introducing Gold to DeFi

Seasoned gold buyers understand the profit potential behind the precious metal. When it comes to safeguarding their hard-earned wealth, their cash may be better off in gold, not paper money, for the following reasons:

Gold could be far more efficient than cash at storing wealth. Interest rates remain low, meaning that your money in the bank “earns virtually nothing”. When you account for inflation, that cash may have actually lost value.

Gold is recognized as having a long-term record of stability. The U.S. has had a completely paper-based currency for 45 years, while gold has been a medium of global exchange for more than 5,000 years. “What people look for is something that’s an insurance policy, an asset that holds its value in times of trouble,” says Avinash Persaud, senior fellow at the Peterson Institute for International Economics. “You don’t want uncertain reserve assets.” With a track record of more than 5,000 years, gold could be the opposite of “uncertain.”

Gold is not a fiat currency. Fiat currencies derive their worth from the issuing government. Unlike paper money, gold cannot be expanded to suit the needs of struggling central banks. Due to its inherent scarcity, gold will always be supported.

This precious metal has maintained its purchasing power over long periods of time, unlike all of the fiat paper currencies that have been introduced over the years, reports Forbes’ Michael Roney.

The Gold Standard DAO introduces gold to DeFi by paying earnings from USD in gold. This is the beginning of building a gold DeFi ecosystem.

DeFi systems normally do not deal with any tokens that are backed by physical assets. Crypto tokens are virtual and have a virtual value proposition. We are introducing the solution where your DeFi yield is backed by a physical asset. Not just any physical asset though. Gold. Real vaulted, audited, insured and verifiable Gold Bullion.

Governance: GSD Token

The protocol is governed through a decentralised autonomous organisation (DAO) structure. The $GSD token is the governance token where holders can participate in the governance of the protocol through voting rights.

The Gold Standard DAO platform takes 10% from vault earnings to fund management and development of the platform (5%), the remaining 5% is distributed to GSD stakers.

As the TVL in the platform grows, the earnings of GSD stakers also grows.

Earned interest paid out to GSD stakers is in the form of tokenized gold.

Tokenomics

The Gold Standard DAO protocol is designed with sustainability, accessibility & security in mind. The governance token of the protocol is the $GSD token. Let’s dive into the $GSD tokenomics:

Total supply and token distribution are carefully designed to benefit early investors.

The total supply of $GSD is limited to 33,000 tokens. This ensures sustainability and protects our investors against dilution.

Breakdown and vesting schedule:

● 51% (16830 $GSD) will be locked away by GSD owners and will never be staked or traded. A wallet address will be provided to monitor this. This GSD will be used by management to scale the DAO on a business level.

● 29% (Approx. 9570 $GSD) allocated to the treasury. These $GSD are reserved for potential partnerships, liquidity pools, future listings (CEX) & incentives/competitions.

● 15% (Approx. 5000 $GSD) has been airdropped to IDO, presale and public sale investors. There is no vesting period.

● 5% (Approx. 1650 $GSD) allocated to the GSD team. There is a 6 month vesting period on these $GSD.

Market Position

Today, cross-chain farming is a poorly developed area. Few entrepreneurs are looking in this direction and we aim to be the premiere service in this market.

Currently, existing aggregators still have a number of limitations:

1. The User must provide liquidity on the desired blockchain, and this is a big issue, as he then has to know which blockchain is best for his desires, and how to navigate many different chains.

2. There are offers from 50+ pools, and a User has to choose which one to use.

No system will choose the most favourable conditions for the User. Now, the user needs to log in every day, check the status of his liquidity, and calculate his returns manually.

The APY shown is often different from the actual returns that the User receives. Users can spend 3–5 days reviewing their strategy. Ultimately, it becomes daily routine work.

The user will not need to worry which chain, pool or stablecoin will provide the highest yield, the platform automates and manages this for the user, optimising yield and saving time.

Gold Standard DAO allows our users to permanently participate in the process of creating optimal profitability.

Security

The Gold Standard DAO team has done a complete analysis of DeFi protocol hacks. We have classified all known hacks and worked out possible methods of protection against them.

Security audits are a constant mechanism of Gold Standard DAO. We will provide audits with the implementation of each feature that affects the work of smart contracts. Audits are to be carried out by Certik.

Notification protocols have been developed to prevent transactions with suspicious activity.

We plan to involve white hackers to test the security system of our product, as well as the use of Bug Bounties.

Creation of the protocol’s own asset insurance fund and involvement of external insurance organisations are planned.

Roadmap

Stage 1 Q4/22:

Cross Currency Yield.
Staking GSD.
Earnings Paid in Gold.
Launch on Avalanche.

Stage 2 Q1/23:

Cross Chain
Ethereum
Binance Chain
Polygon
Fantom
Insurance on Vault.
UI Updates.

Stage 3 Q2/23:

Fiat On / Off Ramp added to platform.
Addition of other stablecoins like EURO / AUD for yield.
Gold Backed NFT’s.
UI Updates.

Stage 4 Q3/23:

Gold As A Service.
Increasing Yield Opportunities on Gold.
Lending Services Added.
Self Repaying Loans.

Website & Socials:

References:

Available Upon Request.