Many use cases for Statera might involve brilliant technical analyses. As much as I appreciate the amount of energy, expertise, research (and most importantly) data analysis that creates a technical use case, I'd argue that the defi community, and economics as a whole, is fueled as much by the psychology of participants (and non-participants) as it is by financial and technological innovation.
As such, we often find that at the heart of every (good) whitepaper lies an explanation of why people need this new coin/token. Statera takes this a step further, by centering their core goals around people, and creating a psychological use case which can be inferred from their whitepaper .
Statera's Psychological Use Case
Though it's typically the tokenomics of the Statera ecosystem (or any other) that are emphasized in DeFi spaces, in Statera's whitepaper we see many references to the importance of people in the larger vision of their ecosystem:
We aspire to put “cryptocurrency in every portfolio.” We envision a world where wealth building strategies that were once only accessible to affluent individuals become available to everyone, transferring the power over our financial systems back to the people. Statera was created as a revolutionary investment tool to bring more people into digital assets, helping to maintain their privacy, security, power, and autonomy. We strive to create an investment ecosystem based on sound monetary policy and all the foundational strength that comes with a sound asset. (p.4, emphasis added).
The egalitarian goals of their ecosystem is shared by many DeFi projects, and this aspirational alignment situates Statera as being a potentially important participant in the larger DeFi ecosystem.
Yet Statera takes these pro-social, egalitarian goals to the next level by creating a psychological use case for their ecosytem. They establish this through first examining the potential psychological impact of their ecosystem on defi, and the macrosystem of global economics.
The whitepaper, quoting the book Bitcoin Standard, establishes the need for deflationary currency mechanisms as foundationally rooted in psychology:
When the value of money appreciates, people are likely to be far more discerning with their consumption and to save far more of their income for the future...Such a world would cause people to develop a lower time preference, as their monetary decisions will orient their actions toward the future, teaching them to value the future more and more....A currency that appreciates in value incentivizes saving, as savings gain purchasing power over time. (p.20, emphasis added)
The whitepaper clearly establishes that Statera doesn't only wish to benefit from the psychological aspects of trading/investing, but to directly impact the psychological and economical health of the DeFi community (and world, as a whole), by influencing values and attitudes in the pursuit of impacting consumer (and, presumably investor) actions and behavior.
Deflation shifts people’s time preference and supports them in making better economic decisions. It also protects their purchasing power, protecting the value of the asset they hold. This can cause an organic and healthy shift in consumer actions and outcomes (p.20, emphasis added)
Again, this is tied to the overall goal of the ecosystem:
The goal is considerable: become a global deflationary currency, used across the world to store and transfer value within a deflationary ecosystem. This will bring deflationary pressures to a macroeconomic scale: increasing the incentives to save, maintaining the value of your assets, and encouraging people to put capital into worthy investments. (p.23, emphasis added)
They thus establish the psychological use case for Statera - to utilize the anticipated psychological impacts of a deflationary currency and ecosystem in order to promote healthy consumer behaviors, which will improve the economic health and overall well-being of people. Both the intention and mechanism of this use case are rooted in psychology, since any "healthy shift" in behavior, achieves by shifts in attitude (i.e. cognitive shifts), rely upon a psychological transformation.
This psychological use case could be seen as the overall meta-use case of all the different technological use cases which can be illustrated for Statera. No matter the intention of the technological use case, the underlying mechanisms of the token and ecosystem are psychologically grounded to ensure that there will be some positive societal impact.
Because of the heavy reliance on a deflationary mechanism, as situated in indices, such as the Phoenix Fund and the Delta Token pool, the function and structure of Statera is thus rooted in the pro-social, psychologically informed goals of the ecosystem.
What are the Practical Implementations of this Use Case?
There are three primary ways that this use case can be implemented, which rely heavily on the psychological underpinnings of Statera. As we have seen through the whitepaper, the focus on people and the psychology of investors is as inherent in the form of Statera, as it is in the structure and function. The project clearly seeks to embrace both the TradFi and DeFi ecosystems as two halves of an intertwined whole, such that they must be equally embraced. Their model seeks to appeal to both worlds. It is a project rooted in our "half" of the greater economic landscape, but is equally situated in concepts common to the traditional finance side of economics. This is demonstrated in both the mechanics of Statera and its inclusion of Synthetix in the Phoenix Fund, which provide some access to the price action of fiat currency and commodity markets and allows efficient and limited integration of traditional markets into an otherwise decentralized and cryptocurrency-dominated project.
As such, there are three applied uses of the psychological use case: 1) to improve the financial and economic sophistication of the DeFi community 2) to expand the DeFi community through the use of Statera as a introductory cryptocurrency DeFi tool for TradFi investors, and 3) to further merge these two worlds in a way that encourages pro-social financial innovation.
Creating a Better DeFi Investor
This first application is easily accomplished through the orienting and re-orienting of Statera's mechanisms, and the mechanisms it utilizes in the DeFi world (such as balancer pools) through the lens of traditional finance concepts such as "deflation", "asset appreciation", "portfolios", and "index funds". These terms are not generally part of the daily parlance of laypeople DeFi fanatics, but should be. Reading any of the ecosystem's official materials is in itself is like taking part of an introductory course for crytpo-geeks into the larger world of economics. It creates a bridge for laypeople between the aspirations of the DeFi movement, and the economic mechanisms of the traditional finance world which could be adopted to meet those goals. A more educated user-base helps to organically encourage independent innovation, and improve the health and wellbeing of the DeFi community, and the individuals comprising it.
The First Step Toward A Future of Mass Adoption
The second application facilitates the migration of sophisticated traditional securities investors onto the blockchain, to the betterment of our community. The use of pools as "index funds" and the focus on traditional financial considerations could help to achieve the kind of mass adoption of cryptocurrency and decentralized finance we've been aspiring toward since the inception of Bitcoin. As we in the DeFi community become more sophisticated and innovate tools inclusive of the best of traditional finance, because of the influence of Statera and it's adoption in our circles, our DeFi ecosystem will become more hospitable to our TradFi compatriots. While there are plenty of bad actors in the TradFi world, there are also many intelligent people with compatible goals who have yet to engage with DeFi projects, and our community, because of lack of familiarity or technical skill. Statera positions itself at the edge of both worlds, yet fully immersed in the culture of the best of both communities. As such, it is ideally situated as an introductory tool which can allow even the most traditional trader or investor a taste of what DeFi has to offer.
The whitepaper's "Advantages and Risks" section illustrates how Statera has feet firmly planted in both the DeFi and traditional finance worlds. Likewise, the"TLDR" section in their white paper, which summarizes the project as a whole, seems particularly keyed to onboard traditional finance investors:
Statera creates cryptocurrency index funds that are decentralized and catalyzed through an immutable deflationary smart contract. It can be included in multiple index funds to increase their value while increasing its own token value. Instead of traditional index funds, where you are charged a fee, since the index fund is used to provide liquidity to exchanges, the holder is paid the fees, earning more capital on their investments (what equates to 38%-500% APY depending on the daily volume). Statera’s deflationary mechanism increases volume (trades and arbitrage), which increases the rebalances and, in turn, the fees paid to the user. Statera benefits the markets it is in, by facilitating more efficient market making, matching buyers to sellers. The ecosystem is fully decentralized and owned by the community. The future of Statera is bright. Not only does it create its own ecosystem, but it also can be used by other ecosystems to instantly introduce sound monetary policy into their platform (loans, NFTs, banking, commerce, any investment instrument, currencies, etc.). This expansion increases the value proposition of the token. With this value proposition Statera can position itself to become the world’s first “global deflationary currency.” The Statera Token gives users one token access to the price action of the entire DeFi suite of products it creates and is included in. (p. 29, emphasis added)
The inclusion of the best and brightest of TradFi will in turn increase our own sophistication, increase TradFi adoption, and among both subsets of the userbase, further innovation will flourish. Ultimately, this leads to the third application.
The Marriage of Both Worlds
Ultimately, the two aforementioned applications result in a happy entanglement of DeFi and TradFi, which will help bring about the kind of shifts in the psychology of investors and their resulting economic behavior that both Statera's creators and our community as a whole aspire toward. Statera's ecosystem is the first step toward a brighter future which is best epitomized by the following excerpt from the whitepaper:
This is the people’s index fund, there can be no exit, torpedoing of the project, or misleading of the project by a centralized entity. This is representative of cryptocurrency and decentralized finance in their purest and most honest form. (p.5)
To achieve the purest and most honest form of DeFi, we must adapt just as we ask our TradFi counterparts to adapt. We must have the courage to reach out and incorporate the old-as-new. Statera models this mindset, which we must adopt, to create the equitable, prosperous future we all desire.
We need to engage with all three of these applications, in our own small way, to achieve success. Just as Statera situates itself as a first step toward greater technological innovation, we must as users pick up the "people-end" of the equation. This is what makes the psychological use case of Statera whole - because psychology is the space where science (in this case, technology) and people meet. Whether you choose to invest in Statera, it's index fund pools, or any other tangible aspect of the product is up to you - this is not investment advice. However there are three ways that you can engage in these applications, regardless of your financial decisions:
1) Use the Statera project as a stepping stone to independently further your own economic and financial understanding. Become a more educated DeFi user, and spread that knowledge throughout the community.
2) Be an ambassador to "the other side" of the financial coin. Use the Statera project to start the conversation with your TradFi friends, colleagues, and relations about the benefits of DeFi. Invite them to read the whitepaper and discuss it with you. You will both learn something.
3) Implement TradFi concepts in our community to spur innovation. Whether as a consumer or developer, you have a role in what future projects look like. Demand the kind of products that, in the TradFi world, are limited only to the affluent. Democratize and decentralize traditional financial projects that might otherwise had gone astray. Use DeFi as a lens through which to remake the world.
By implementing the three major applications of the psychological use case of Statera in such a way, we can create the kind of healthy economic global ecosystem and healthier consumer behaviors among individuals that Statera aspires to achieve.