Real USD can be redeemed 1:1 for DAI at any time.
A small fee will be charged on all USDR redemptions. The fee is configurable and will sit just above the Curve fee to encourage swaps over redemptions, helping to maintain greater stability in the treasury.
While Real USD is designed to guarantee redemptions for DAI at any time, it’s not inconceivable that heightened demand for USDR redemptions might deplete existing DAI reserves, outpacing our ability to responsibly downsize the treasury. In this instance, the solution is to issue pDAI or promissory DAI. If treasury DAI has been depleted, any users wishing to redeem their USDR will receive pDAI at a 1:1 ratio. pDAI, as its name suggests, entitles the user to claim DAI 1:1 once real estate TNFTs are liquidated and the proceeds are transferred back into the treasury as DAI.
Real USD’s unique collateralization gives Tangible the flexibility to provide users with an immediate redemption solution while providing time for the treasury to liquidate real estate TNFTs or the underlying physical properties. The approach of issuing pDAI is only possible because USDR is backed by real estate assets which are a proven store of value.
While USDR is designed to be over-collateralized, the pDAI mechanism gives users additional comfort, negating some of the concerns of utilizing a less liquid asset as backing.
The maximum supply of pDAI at any given time is the total USD value of all RWAs and DAI in the treasury. When pDAI is redeemed for DAI it is burned.