The Fedz is inspired by the principles of the traditional banking system and adapts its essence to the Web3 metaverse. As traditional banks facilitated economic growth through fractional banking and monetary policy, the Fedz brings this foundational concept into crypto. However, the difference is not merely in the service or product we provide - it's in who we provide it for.
A Brief Dive into Traditional Banking System
Traditional banking systems, spearheaded by central banks like the Federal Reserve, exist to facilitate the monetary system, stabilize the economy, and allocate capital. They operate as intermediaries, issuing fiat currency (like the US dollar) and maintaining its value through complex policies. Their "customers" are manifold:
"Reserve Bank activities serve primarily three audiences—bankers, the U.S. Treasury, and the public:
Federal Reserve Banks are often called the "bankers' banks" because they provide services to commercial banks similar to the services that commercial banks provide for their customers. Federal Reserve Banks distribute currency and coin to banks, lend money to banks, and process electronic payments."
Source: federal reserve bank of saint louis
The Fedz borrows this model but reinvents it for a new ecosystem, the decentralized economy of Web3. Instead of fiat currency, we issue FUSD, a USD derivative designed to thrive in decentralized finance (DeFi). While fractional reserve principles guide its issuance, the focus shifts to making these tools accessible and capital-efficient for the metaverse.
But this isn’t where the story ends. The true revolution lies in who we are here to serve.
The Federal Reserve’s Audience: A Two-Tiered System
The Federal Reserve operates with three key audiences in mind:
Bankers – Commercial banks that rely on the Federal Reserve for essential services like liquidity and clearing.
The U.S. Treasury – The government entity managing public debt and monetary policy.
The Public – Individuals and businesses that indirectly rely on the stability and availability of the monetary system (in the Fed's case, the US Public, even though you can think about USD users).
By balancing the needs of these three, the Federal Reserve acts as a central authority, often prioritizing national economic policy over individual interests. This creates a system where decisions are made to align with broad economic goals, sometimes sidelining the specific needs of the public.
The Fedz Audience: One Consumer, One Purpose
In stark contrast to the traditional Federal Reserve, The Fedz serves only one customer: the Web3 public.
The Federal Reserve operates as a balancing act. For example, during a press conference, the Fed Chairman announced an interest rate hike. His primary focus may be price stability and fighting inflation, but he also juggles competing mandates: keeping unemployment low and fostering economic growth. Every decision is a compromise, carefully calibrated to satisfy multiple, often conflicting stakeholders: the U.S. Treasury, the banking system, and the general public.
This juggling act ensures the Federal Reserve is constantly pulled in different directions. Stabilizing prices might mean raising interest rates, which risks slowing growth or increasing unemployment. Lowering rates might stimulate jobs and spending but can also stoke inflation. It’s a system designed for trade-offs, where no single audience gets undivided attention.
The Fedz is different. Our mission doesn’t require juggling multiple mandates or serving several masters. We have one goal: earning the trust of the Web3 public.
Winning the Trust Game in Web3
Unlike the Federal Reserve, The Fedz operates in a competitive, decentralized marketplace where trust is everything. Our competitors are other stablecoin issuers. To succeed, we must outperform them in delivering what the Web3 public values most: stability, transparency, and capital efficiency.
Trust isn’t given; it’s earned. Stablecoin users don’t care about lofty macroeconomic goals or press conferences. They care whether their dollar derivative token holds value when markets are in chaos, whether they can move liquidity seamlessly, and whether their systems are robust against failure. Every wallet owner is asking one question: Can I trust you to deliver stability when I need it most?
A Single Purpose: Serving You
The Fedz applies game theory and economic research to create a stablecoin system optimized for the Web3 community. By modeling user behavior and market dynamics, we design mechanisms that ensure price stability and align incentives across participants.
While the Federal Reserve makes policy for a vast and varied economy, we’re building for a focused audience - you, the Web3 user. Our success isn’t tied to employment rates or GDP growth. It’s tied to one metric: your confidence in holding and using FUSD.
In this competitive game of stablecoins, we’re playing to win by doing what no central bank or competitor can do: dedicating 100% of our resources to satisfying a single customer base. Your trust is our only mandate.
