Peg Stability Module
DOLA Peg Stability Module (PSM)
The DOLA Peg Stability Module (PSM) is the successor to the DOLA Stabilizer, which was originally introduced in February 2021 as one of Inverse Finance’s initial products, facilitating a stable 1:1 swap between DOLA and DAI. The Stabilizer became quasi-redundant with the introduction of DOLA AMM Feds and the expansionary DOLA Fed policy and was deprecated in October 2023 as a proactive measure to prevent unforeseen scenarios or vulnerabilities that might arise from maintaining a redundant contract.
However the need for a mechanism that offers immediate DOLA liquidity to liquidators, ensuring orderly and efficient liquidations, has persisted and while the legacy Stabilizer offered basic peg defense it lacks flexibility and resilience. The DOLA Peg Stability Modiule addresses those prior shortcomings and adds features for safer long-term use.
Key Features of the PSM
Integration with ERC4626 vaults (initially sUSDS), enabling yield on reserves.
Governance-controlled migration to new vaults if needed.
Configurable buy/sell fees and profit routing.
Controller hooks for future extensions, such as depeg protections.
Safeguards against inflation-style attacks, including minimum total supply checks.
Modular architecture with separate PSM, PSMFed, and Controller contracts
Gas-optimized operations for efficient arbitrage and liquidation support
How the PSM Works
Users may swap USDS for DOLA on a 1:1 basis when DOLA is above peg or when USDS is below the price of DOLA.
Users may swap 1 DOLA for 0.998 USDS (incurring a 20 bps fee) when DOLA is below its USD peg or when USDS is above its USD peg.
Deployed Contracts
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