Reserve(collateral)

Reserve is the core of keeping HYDT peg to 1 dollar.

Reserve balance(collateral) is held in BNB, makes HYDT stablecoin BNB-backed.

When HYDT price is above 1.02 dollar, Mint contract will mint HYDT automatically, selling in on BNB/HYDT pair on pancakeswap and transferring BNB to reserve address.

When the HYDT price is below 0.98 USD, Redeem contract is called once per 4 hour, buying HYDT with BNB from the reserve address and burning it.

By buying HYDT below 1USD and selling HYDT above 1USD, HYDT will always be pressured to be close to 1 HYDT=1 USD. Furthermore, the protocol automatically corrects for price deviations in the event of a large de-peg, as the amount to buy and sell increases as the price of HYDT moves away from one dollar.