House of Chimera Research: A Fundamental framework on Commodity and Fiat Money

House Of Chimera is delighted to release a new research paper, which aims to provide a fundamental framework on Commodity and Fiat money. The research paper is a submission to the Reserve Hackathon on Gitcoin. The paper aims to provide insights into how fiat and commodity money work and how it is created; additionally, it provides the benefits and drawbacks of both concepts.

What is Reserve Protocol?

Reserve Protocol targets the ever-growing inflation problem by enabling anyone to create asset-backed currencies (Rtokens). These stablecoins are fully redeemable for the collateral. By allowing anyone to set up a Rtoken, users can tweak them until they have discovered the ‘perfect basket’. Reserve Protocol also has an IOS and Android application called ‘Reserve’, currently available in 16 countries. The app is designed to help people living in hyperinflationary countries protect their purchasing power (i.e. savings). The app provides users access to the token Reserve (RSV), a stablecoin pegged 1:1 to the United States Dollar.

Want to learn more about Reserve Protocol? Click here

Aim of the research

Our research aims to provide the reader insight into fiat and commodity money fundamentals by providing easy-to-understand examples. The research can be treated as a tool for existing and upcoming Rtoken developers to determine the ‘perfect’ commodity basket. We have based our paper on literature research. There are currently many misconceptions about fiat and commodity money (e.g. how it is created). Our research aims to contribute a solid foundation for Rtoken creators to develop a Rtoken. The study offers handles for Rtoken developers to determine the ‘perfect’ commodity basket while providing valuable and comprehensible insights to newcomers. Additionally, a small section on behavioural economics has been added to give the reader a sense of the importance.

Future Research

A more in-depth commodity model will be explained in future research based on the Sargent and Wallace model. Additionally, more in-depth insight into behavioural economics is required for Rtoken developers to create a robust Rtoken. This will be discussed in future research.

Read the complete research paper HERE!