General
What is The INC Printer Protocol?
INC Printer is a decentralized borrowing protocol that allows you to draw interest-free loans against INC used as collateral. Loans are paid out in INCD (a USD-pegged stable coin) and must maintain a minimum collateral ratio of 110%.
In addition to the collateral, the loans are secured by a Stability Pool containing INCD and by fellow borrowers collectively acting as guarantors of last resort. Learn more about these mechanisms under Liquidation.
INC Printer as a protocol is non-custodial, immutable, and governance-free.
What’s the motivation behind INC Printer?
Stable-value assets are an essential building block for PulseChain applications and have grown to represent tens of billions of dollars in value.
However, the vast majority of this value is in the form of fiat-collateralized stable coins like Tether and USDC. Decentralized stable coins like DAI and sUSD make up only a small portion of the total stable coin supply, meaning the vast majority of stable coins are centralized.
INC Printer addresses this by creating a more capital-efficient and user-friendly way to borrow stablecoins. Furthermore, INC Printer is governance-free, ensuring that the protocol remains decentralized.
What are the key benefits of INC Printer?
INC Printer Protocol’s key benefits include:
0% interest rate — as a borrower, there’s no need to worry about constantly accruing debt
Minimum collateral ratio of 110% — more efficient usage of deposited INC
Governance-free — all operations are algorithmic and fully automated, and protocol parameters are set at time of contract deployment
Directly redeemable — INCD can be redeemed at face value for the underlying collateral at any time
Fully decentralized — INC Printer Protocol contracts have no admin keys and will be accessible via multiple interfaces hosted by different Frontend Operators, making it censorship-resistant
Can INC Printer be upgraded or changed?
No. INC Printer has no admin key, and nobody can alter the rules of the system in any way. The smart contract code is completely immutable.
How can I use INC Printer?
You first need to choose a web interface (aka frontend) to access the system. INC Printer can be accessed through community-hosted frontends or by third-party applications and integration services.
What are the main use cases of INC Printer?
Borrow INCD against INC by opening a Vault
Secure INC Printer Protocol by providing INCD to the Stability Pool in exchange for rewards
Stake PRINT to earn the fee revenue paid for borrowing or redeeming INCD
Redeem 1 INCD for 1 USD worth of INC when the INCD peg falls below $1
What are INCD and PRINT?
INCD is the USD-pegged stable coin used to pay out loans on the INC Printer Protocol. At any time, it can be redeemed against the underlying collateral at face value. Learn more about the stability mechanism.
PRINT is the secondary token issued by the INC Printer Protocol. It captures the fee revenue generated by the system and incentivizes early adopters and frontends. The total PRINT supply is capped at 100,000,000 tokens. For more information on how the tokens are allocated and released over time, please refer to PRINT Rewards and Distribution.
What do I need in order to use INC Printer?
To borrow INCD, all you need is a wallet (e.g., MetaMask) and sufficient INC to open a Vault and pay the gas fees.
To become a Stability Pool depositor or PRINT staker, you need to have INC Printer and/or PRINT tokens. INCD can be borrowed by opening a Vault, while PRINT can be earned as a Stability Pool depositor. You can also use PulseX exchange to buy the tokens on the open market.
Does the The INC Printer Protocol charge any fees?
There is a one-off fee whenever INCD is borrowed and when INCD is redeemed:
For borrowers, there is a borrowing fee on loans as a percentage of the drawn amount (in INCD).
For redeemers, there is a redemption fee on the amount paid to users by the system (in INC) when exchanging INCD for INCD. Note that redemption is separate from repaying your loan as a borrower, which is free of charge.
Both fees depend on the redemption volumes, i.e., they increase upon every redemption in function of the redeemed amount, and decay over time as long as no redemptions take place. The intent is to throttle large redemptions with higher fees and to throttle borrowing directly after large redemption volumes. The fee decay over time ensures that the fee for both borrowers and redeemers will “cool down” while redemption volumes are low.
The fees cannot become smaller than 0.5% (except in Recovery Mode), which protects the redemption facility from being misused by arbitrageurs front-running the price feed. The borrowing fee is capped at 5%, keeping the system somewhat attractive for borrowers even in phases where the monetary base is contracting due to redemptions. Other than that, the two fees are identical.
How can I earn money using The INC Printer Protocol?
There are two different ways to generate revenue using INC Printer:
Deposit INCD to the Stability Pool and earn liquidation gains (in INC) and PRINT rewards.
Stake PRINT and earn INCD and INC revenue from borrowing and redemption fees.
Can I lose my funds?
As a non-custodial system, all the tokens sent to the protocol will be held and managed algorithmically without the interference of any person or legal entity. That means your funds will only be subject to the rules set forth in the smart contract code.
There are two scenarios under which you may lose a part of your funds:
You are a borrower (Vault owner) and your collateral in INC is liquidated. You will still keep your borrowed INC Printer, but your Vault will be closed and your collateral will be used to compensate Stability Pool depositors.
You are a Stability Pool depositor and your deposited INCD is used to repay debt from liquidated borrowers. Since liquidations are triggered any time borrowers’ collateral drops below 110%, you will receive more INC in return with a very high probability. However, if INC decreases in price and you maintain exposure, you may lose value in your total pool deposits.
Please note that INCD isn’t perfectly pegged to the USD and can deviate slightly in both directions under certain market conditions.
Although the system is diligently audited, a hack or a bug that results in losses for the users can never be fully excluded.
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