Reserve Rights are a pool of stablecoins designed to bring down the risk due to diversification and decentralized governance.

Reportedly, there are three developmental phases with the Reserve Rights Protocol.  It is the centralized phase, decentralized phase, and the independent phase.  There are advantages and disadvantages in each developmental phase. 

When the system is more decentralized it is very harder to change it.  When compared to several other stablecoins like USDC, PAX, USDT the current stage of centralized RSV development is relatively decentralized.

The on-chain collateral that is governed by the users backs RSV.  Users will thus be able to decide if they need to submit requests to re-balance the new token or the RSV collateral to a new token or they might think if they should change the relative weighting between the different collateral tokens.

The core team should approve the changes though during the current phase.  There will be mostly only USD stable coins.  The collateral backing will also be completely transparent.

In this regard, Sydney Ifergan, the crypto expert tweeted:  “The RSR team are continuing with their vision of having to provide a decentralized stable coin, which makes it possible to use crypto as the real money.”

Reserve Rights (RSR) Stability

A better money is something that is required by the world, the most, in the current scenario. There is no denying that the initial production of the Reserve Protocol coins happened in a substantially centralized way.

There are three kinds of tokens in the Reserve Protocol.  The Reserve token (RSV) being a stable cryptocurrency can be held and spent just like we use US dollars and other stable fiat money.

The Reserve Rights token (RSR) is the cryptocurrency which is used to provide for the stability of the Reserve token.

There are Collateral tokens which are other assets held by Reserve Smart Contract to back the value of the Reserve token.  This is a lot similar to what the US government used in order to back the US dollar with gold.

The protocol is designed to hold collateral tokens that are worth nearly 100% of the value of all the Reserve tokens.  The value of these collateral tokens are used to tokenize real-world assets like tokenized bonds, property, and commodities. Thus, the portfolio is made in a way to start off relatively simply to eventually diversify over time as more of the asset classes are tokenized.

For everyday users, the Reserve is just an app for buying, holding, and spending digital US dollars.