▶️Current Version
🔴 User Actions:
Deposit:
Users can deposit stablecoins (currently only USDT) into the Engine contract, which will mint tgUSD at a 1:1 ratio.
When the Engine contract receives a user's deposited USDT, it will immediately transfer the funds to the Multisig Wallet to await cross-chain bridging.
Redeem:
Users can redeem tgUSD back to USDT.
Redemption is currently whitelist-gated and subject to a cooldown period before the USDT can be claimed.
Stake:
Users can stake tgUSD into the Staking contract to mint stgUSD based on the current conversion rate.
As staking rewards are distributed to stgUSD holders, the price of stgUSD appreciates continuously over time.
Unstake:
Users can unstake stgUSD to receive tgUSD representing both principal and accrued rewards.
After unstaking, users must wait a 7-day cooldown period before claiming.
🔵 Protocol Operations:
Cross-Chain Yield Generation: Torch Finance moves assets across chains to generate yield. All associated losses (e.g., slippage, fees) are absorbed by the protocol. Two methods are used:
Dynamic Bridge Selection: Depending on the amount and slippage, the protocol selects the most efficient bridge from Stargate, USD0, or Symbiosis.
OTC Support: If bridge slippage is high or the transaction exceeds the maximum cross-chain transfer limit, an OTC route is used as a fallback to complete the transfer efficiently and cost-effectively.
🟢 Reward Aggregation:
Yield earned from external DeFi protocols is aggregated and distributed to stgUSD holders on TON.
The aggregated yields will first be minted into tgUSD through the Engine contract, then directly distributed to the staking contract.
🟣 Peg Arbitrage Mechanism:
When a price deviation occurs between tgUSD and USDT in liquidity pools, the protocol withdraws staked tgUSD from the Staking contract to perform arbitrage and restore the peg.
After the arbitrage is completed, the acquired USDT is converted back into tgUSD, which is then used to repay the borrowed tgUSD to the Staking contract.
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