NUM Finance is a project that aims to create stable cryptocurrencies that track the value of emerging market currencies. These cryptocurrencies are called Num Stablecoins.
Currently, there are several stablecoins in the crypto assets market. However, most of them follow the price of the currencies of developed nations. The most well-known examples are the stablecoins that track the U.S. dollar, such as USDT, USDC, DAI, etc.
The existence of these tokens was fundamental to the development of the decentralized finance ecosystem that thrives today on the main blockchains. Activity in decentralized finance protocols is growing in parallel with the circulation of these stablecoins. While there are other stablecoins that track the price of other currencies from developed countries, there are very few from emerging economies or Latin American markets.
Num Finance seeks to facilitate access to cryptocurrencies and decentralized finance to millions of people and companies in emerging countries through the creation and promotion of Num Stablecoins.
It is precisely in these countries, where monetary problems such as inflation, capital controls, lack of access to credit and complex financial products abound; where decentralized finance can have the greatest impact on the lives of citizens and the economic activity of companies. With Num Stablecoins and the growth of their adoption, Num Finance seeks to strengthen local currencies by adding a product that can be used by market players in a completely open way.
The Num-S aim to be:
• Highly liquid
• Secure and Transparent
• Freely accesible to averyone
• Integrated into local communities and partners
Num Finance was created in 2021. In December of that year, its first stablecoin was launched: Num ARS (nuARS), a stablecoin of the Argentine peso.
Num-S are collateralized stablecoins, minted and issued by Num Finance.
The issuance consists of putting new tokens into circulation. As they are collateralized, Num-S are only issued if they have an asset of equal or greater value backing them.
Unlike other stablecoins, Num Stablecoins will have a hybrid collateralization system: they can be issued with the backing of other cryptocurrencies, fiat money and other assets. The issuance of Num-S is carried out through one of the following mechanisms to ensure its proper collateralization:
1) The first issuance method of Num-S is through the loan mechanism with cryptocurrency collateral. In a collateralized loan, the Num-S issuer must leave some of the accepted cryptocurrencies as collateral with Num Finance as a guarantee. This mechanism is used by other stablecoins on the market such as DAI (from MakerDAO) or LUSD (from Liquidity Protocol).
When a user deposits collateral in Num Finance, it generates an available balance to take out Num-S loans. When the user decides to take out a loan, Num-S are issued. Conversely, when the user repays the loan, the returned Num-S are withdrawn from circulation by Num Finance, and the user can withdraw their collateral.
2) Secondly, users can buy Num-S using various payment methods. When a user buys Num-S, Num Finance receives an asset for a value equivalent to the Num-S issued and received by the user. These assets can be other cryptocurrencies, legal tender currencies, or other assets. All the received assets constitute Num Finance's own reserve, known as the NFR (Num Finance Reserve). The NFR acts as collateral for all Num-S issued through the purchase mechanism.
Just as users can issue Num-S by buying tokens from Num Finance, they can also perform the opposite operation and redeem Num-S by selling tokens to Num Finance. Num Finance uses the assets in the NFR to pay for the Num-S it repurchases and removes from circulation.
NFR will operate similarly to Maker DAO's Price Stability Module (PSM) and will contribute to the stability and security of each Num Stablecoin.
In the future, Num Finance will seek to implement other issuance mechanisms that respect the principles of collateralization and parity with the aim of increasing access to Num Stablecoins in an open and transparent manner. Not all issuance mechanisms are in effect at all times for all Num-S but they are activated progressively and can be paused.
Minting refers to the creation of tokens. Num-S that have been minted are not considered as circulating supply and do not need collateral until they are issued. These tokens can only be issued through the mechanisms developed by Num Finance.
For operational and security reasons, Num Finance will mint Num Stablecoins only to its own wallets. The minted Num Stablecoins will not be issued, meaning they will not enter circulation until they have the backing provided by one of the mechanisms described in section 2. This will create Num Stablecoins under the condition of "Minted but not issued". Num Finance will publish in the "Reserve Reports" the addresses that store these Num Stablecoins for public knowledge.
The current tokens of the Num Stablecoins are native to the Polygon network and were deployed on that network in their initial stage in March 2023.
The conception of the Num Stablecoins is that they are Multichain. Therefore, in a second stage, there will be synthetic versions of these tokens on other networks such as BNB Chain.
Num Stablecoins will seek to track the value of a particular currency. For example, the token Num Finance PEN (nPEN) will seek to track the value of the Peruvian sol, and the token Num Finance ARS (nARS) will seek to track the value of the Argentine peso.
The existence of the NFR, along with an agile and efficient implementation, improves the peg of each Num-S with the local reference legal currency.
This happens because in moments of overvaluation or undervaluation of the Num-S compared to the local legal tender, there will be possibilities for arbitrage that increase the stability of the Num-S even if they are not executed. Since they are issued against collateral valued at market value and against the respective national currency, the Num Stablecoins will tend to naturally follow the reference value. However, Num Finance does not guarantee that the market value of any of the Num Stablecoins will be equal to the reference fiat currency at all times.
Num Finance reserves the power to implement and improve these and other automatic stabilization mechanisms to increase the desired peg of each Num Stablecoin.
In March 2023, we deployed the new Num Stablecoins tokens. The two tokens we relaunched were nARS and nPEN, both of which are native to the Polygon network.
Previously, these tokens were called nuARS and nuPEN and were only developed on the BNB Chain blockchain.
In addition, Num Finance can activate yield programs for those who invest their Num-S. Investments are made in a specific smart contract for each token. Authorized users can send their Num-S to those addresses and receive in exchange an a-Num-S token whose value increases at a rate stipulated by the contract.
For now, the only active contracts are those of a-nARS and a-nPEN.
Many currencies from emerging countries are often unattractive as a store of value. This raises intrigue about the usability of any stablecoin that seeks to track the price of any of those currencies. However, these currencies still remain the principal medium of exchange and unit of account in the economies of these countries.
In such economies, individuals and businesses receive income, pay expenses and plan their projects in local currency, among other activities. In this context, Num Stablecoins have many applications for integration into the daily lives of economic agents. Decentralized finance and person-to-person transactions are the main use cases.
Num Finance is funded by private capital. Num Finance does not have any governance tokens. Each Num Stablecoin launched will be announced on our official communication channels.
Num Finance will publish on a quarterly basis the evidence of funds backing the Num Stablecoins issued. It will also publish the addresses of the wallets containing such funds so that the funds can be monitored in real time by the public. At the same time, the addresses containing Num Stablecoins minted but not issued will be published.
Only users previously verified and approved by the KYC and AML/FT rules will be able to operate directly with Num Finance. External custodians, in turn, must also comply with these same policies. The use of Num-S through third parties (exchanges, wallets, etc.) is subject to the compliance policies of those companies.
This document and all its annexes are written for informational and educational purposes, and may be freely distributed. They reflect information, opinions, and plans of the Num Finance team. Num Finance may alter, modify, and/or replace any information contained in this document and all its annexes at any time without prior notice or responsibility of the Num Finance team or Num Finance.
Neither this document nor any of its annexes constitutes an offer and/or invitation to the public to make offers, investments, or to acquire and/or consume financial services. Furthermore, neither this document nor any of its annexes has legal validity nor will it generate obligations and/or liability for the Num Finance team or Num Finance.
Num Stablecoins are freely tradable. However, Num Finance does not guarantee that anyone who acquires Num-S and/or a-Num-S in the market will be able to exchange or sell them subsequently at the reference price of the local currency in question or at any other price. Anyone who acquires Num-S and/or a-Num-S assumes inherent risks associated with the acquisition of cryptocurrencies.
For further information please download: “Project Documentation” - Num Finance
Do you have any further questions about the project? Do not hesitate contact our team. We are ready to help you.