What is Reserve Rights?

Reserve Rights (RSR) is an ERC-20 token that plays a crucial role in the Reserve Protocol. Launched in May 2019, RSR serves two primary functions: overcollateralization of Reserve stablecoins (RTokens) through staking and governance of these tokens through proposing and voting on changes to their configuration. RSR is not just a governance token for RTokens, but also acts as a safety net to ensure RToken holders are compensated in the event of a collateral token default. RSR holders can choose to stake on any RToken, divide their RSR tokens by staking on multiple RTokens, or opt not to stake their RSR at all. In return for providing this first-loss capital, RSR stakers may receive compensation from the RToken they chose to insure.

How does Reserve Rights work?

Reserve Rights operates within the Reserve Protocol, a system that allows the creation of RTokens, which are stablecoins backed by a basket of cryptocurrencies managed by smart contracts. These baskets can consist of any ERC-20 assets, including stablecoins like USD Coin (USDC), True USD (TUSD), and Paxos Dollar (USDP), as well as DeFi-yield bearing assets like Compound USD Coin (cUSDC) and Aave Dai (aDAI). RSR holders can stake their tokens to provide overcollateralization for these RTokens, thereby ensuring their stability. In the event of a collateral token default, RSR acts as a backstop to compensate RToken holders. The Reserve Protocol aims to transition to more diverse baskets in the future, potentially including fiat currencies, securities, commodities, and complex asset types like synthetics and derivatives.

What are the potential use cases for Reserve Rights?

Reserve Rights (RSR) has a variety of potential use cases within the Reserve Protocol. Primarily, it serves as a governance token for Reserve stablecoins (RTokens), allowing RSR holders to propose and vote on changes to RTokens. Additionally, RSR provides overcollateralization for RTokens, acting as a safety net in the event of a collateral token default. This overcollateralization function allows RSR holders to stake their tokens on any RToken, potentially receiving compensation from the RToken they chose to insure. As the Reserve Protocol evolves and more diverse asset baskets are introduced, the role of RSR may expand, offering additional use cases for holders.

What is the history of Reserve Rights?

Reserve Rights (RSR) was launched in May 2019 following a successful initial exchange offering (IEO). The Reserve Protocol, within which RSR operates, was co-founded by Nevin Freeman and Matt Elder. Freeman, a seasoned entrepreneur, serves as Reserve's CEO, while Elder, an experienced engineer who previously worked for Google and Quixey, oversees the architecture of the Reserve protocol implementation as the project’s CTO. Since its launch, the Reserve team has grown significantly, now comprising over 200 individuals, including engineers, developers, and legal and compliance staff. The team shares a common goal of positioning Reserve as an open, massively scalable stablecoin platform that aims to contribute to economic prosperity.