What is Lottery Set Dollar?

Lottery Set Dollar (LSD) is an algorithmic stablecoin that has uses an elastic supply mechanism. Instead of using collateral to hold it's $1 price peg, LSD uses a set of positive and negative incentives to keep the price at $1. The protocol is centered around a BSC-20 token: LSD. Unlike other stablecoins that uses a dual token system, LSD uses a single token system and acts both as the stabilized dollar and as the governance token for the protocol.

In order to self-stabilize, the protocol uses voluntary supply expansions and contractions around a Time Weighted Average Price (TWAP) oracle from the incentivized trading pool on Pancakeswap.

Whenever the TWAP price is below $1, users have the chance to buy Tickets (Lottery Set Dollar Tickets). Users burn 1 LSD to obtain 1 Ticket. On the period of first positive rebase, a lottery is initiated with the prize pool equalling to 50% of the positive rebase (after all debt/ticket sales are cleared)

LSD is inspired by Empty Set Dollar (ESD) and aims to take an alternate game theory approach with different sets of incentives. The goal is to build a simpler and more familiar set of rules that are equally as effective for rebasing.