RAI Dollar

Restoring the peg under
collateral impairment
+ liquidity crisis

Deep dive: a backing shock meets minimum market authority.
RD / USD · controller timeline
Calm
BACKING −5% q → 20% PAR ENTRY $1.000
TWAP Par Floor
Market TWAP
$1.000
inside the deadband
System rate
2.0%
2% resting bias
Authority q
100%
full market depth
Active instrument RATE holds the baton
RATE PAR
Fast path · 24h waiting for rate bound
Fallback · 7d waiting for sustained error
01 · Calm
Rate rests at 2%. Par rests at $1.
The controller starts with its everyday instrument: the cost of borrowing.

A five-percent collateral impairment pushes RD below peg. Rate reaches fifty percent but cannot repair the missing backing. Liquidity then falls, reducing controller authority to twenty percent and pulling rate off its ceiling, which resets the fast twenty-four-hour PAR-entry timer. The independent seven-day sustained-error timer continues and hands control to par.