Dual Value Tokenization Model (DVTM)
Final Definition – Dual Value Tokenization Model (DVTM)
The Dual Value Tokenization Model (DVTM) is an innovative framework for tokenizing volatile assets with the aim of stabilizing value while maintaining full utility of the underlying asset.
Token Structure
In this system, a volatile asset is locked into a smart contract, and two complementary tokens are issued:
1. Fixed Token
A predefined portion of the asset (e.g., equivalent to $1) is allocated to create a stable token, designed to function as a base currency within decentralized financial ecosystems.
2. Residual Claim Token (RC Token)
The remaining value of the asset, after deducting the fixed portion, is represented by the RC Token. Its price fluctuates dynamically based on the market price of the underlying asset.
Automatic Collateral Stabilization Feature
DVTM operates as an automatic stabilization tool, dynamically adjusting the portion of the asset collateralized for the Fixed Token based on market fluctuations.
The system is capable of maintaining collateralization levels ranging from a small fraction of the asset's value to its full amount, depending on price changes.
Example:
Suppose 1 SOL (Solana) is submitted when its price is $100:
- Only 0.01 SOL is locked as collateral for the Fixed Token (worth $1), while 0.99 SOL is freely represented by the RC Token (RCSOL).
- If the SOL price drops to $10: 0.1 SOL is automatically allocated to maintain the $1 backing, and the RCSOL balance adjusts to 0.9 SOL.
- If SOL crashes to $1: The entire 1 SOL is collateralized for the Fixed Token, and RCSOL value reduces to zero.
Redemption Mechanism
Redemption Process
The original asset can only be redeemed when both the Fixed Token and the RC Token are returned simultaneously to the smart contract.
This preserves asset integrity and prevents unilateral extraction or manipulation.
RC Token Valuation
Value Calculation
RC Token value = Total Asset Value − Fixed Token Value
The RC Token acts as a live, digital certificate that continuously reflects the dynamic residual value of the underlying asset.
Conclusion
Key Benefits
DVTM offers a powerful solution by splitting a volatile asset into a stable financial instrument and a dynamic investment vehicle.
It creates a floating collateral structure that adapts automatically to price changes, enabling stable decentralized currencies without relying on fiat systems.