USTX: transparency and risks
One of the main risks for an early token/coin adopter is being scammed by the team proposing the project. For this precise reason our main goal has been from the beginning to build a trustless and decentralized system. That’s why the smart contracts will manage most of the token and DEX operation autonomously. The team will not be allowed to tamper with the contract parameters outside predefined levels, hard coded in the contract code and visible to anyone, because the code is open source.
Another risk related to traditional DEX based systems is rug pull, where the owner of the currency removes all the liquidity from the trading pool, usually after having created a lot of hype on social media. The USTX DEX contract does not implement any function to withdraw the stablecoins liquidity form the pool.
Smart contracts are very powerful systems that enable the implementation of transactions between individuals without relying on trust on each part involved. This is true if the contract itself is built without malicious intent. That’s why all USTX contracts have been audited to make sure that no security risk or fraud will be possible, before going into mainnet and before the launchpad begins.
Another important aspect from the user point of view is the possibility to know the internal reserve level, to make sure that the token value is actually backed by the expected amount of collateral. Stablecoins backed by FIAT use external auditors to certify the amount of reserve currency. Since USTX DEX internal reserves are all TRC20 contracts and everything happens on-chain, all the user needs to do is visit the Tron blockchain explorer and look at the balances in the DEX contract. Everything is in plain sight and impossible to be tampered.
The smart contracts have be audited by an independent third party to ensure that they work as designed.
The smart contracts implementation, while done at the best of the team possibilities, will carry a residual risks due to undiscovered bugs. The contract have been audited by a third party after private and comnunity testnet debugging sessions, but 0% risk is not possible.
Another risk derives from reserve tokens in the DEX. Having a multiasset reserve reduces this risk, but does not eliminate it. The DEX functionality depends on USDT, USDJ, USDC, and TUSD, which are not under the team control. If anything happens to one of those tokens there could be negative impact on the DEX functionality and consequent loss of value, even if the contracts allows to reduce negative effects.
Each participant should consider all the risks, the ones stated above and those that generally apply to community projects in the cryptoverse.
DYOR before participating to this project.