Say I tokenize an amount of gold and generate a Smart Vault of 100,000 S-EURO - effectively borrowing S-EURO against my gold. My gold is insured, in a vault, and audited regularly - all of which adds maintenance costs; these costs would be covered in full or in part via a daily reduction of the initial 100,000 S-EURO balance required to close my Smart Vault and restore full ownership of my gold. I am also charged a daily stability fee primarily driven by fluctuations in supply and demand for S-EURO. If, for example, a significant increase in demand for S-EURO causes it's price to exceed that of fiat EURO, the stability fee will decrease and the cost of maintaining my Smart Vault (a.k.a. loan) will reduce - much like a lower interest rate being applied. This fee volitivity is intended to encourage asset holders to hold/tokenize or de-tokenize my assets based on the supply and demand for S-EURO... Think I have that part down.. Now the hard part..

Would a reduction in stability fees really result in the desired outcome of getting asset holders to tokenize more assets? Onboarding new asset holders should be a lengthy review and approval process, so in the short term you'd largely depend on existing asset holders to tokenize more of their assets; this assumes asset holders would initially tokenize a portion of their assets and would be open to tokenizing more assets down the road given the right circumstances. I don't see low fees as much of a draw, but after some consideration I can see the appeal of tokenizing assets while the S-EURO is overpriced ASSUMING the value of S-EURO issued exceeds the real world value of tokenized asset (i.e. my 100k EURO worth of gold is tokenized 1:1 for 100k S-EURO despite the market price of 1 S-EURO to 1.2 EURO; effectively my 100k EURO asset is tokenized for 120 EURO worth of S-EURO). This approach would rapidly increase the supply of S-EURO as asset holders seek to cash-in on inflated valuation; the result would be a bevvy of 'approved' asset holders waiting for the right conditions for quick profit, and a corresponding rapid price correction. Conversely, should the value of S-EURO issued in this scenario be roughly equal to the value of the tokenized asset (i.e. when 1 S-EURO = 1.2 EURO, a 100k EURO asset receives 83k S-EURO, worth 100k EURO at the time), low fees alone would hardly incentivize asset holders to tokenize, resulting to a sluggish price correction at best and a complete decoupling at worst.

A snap crash in the cryptocurrency market would be liable to spark a very sudden and immense increase in demand for S-EURO; without an aggressive price correction system in place, you risk undermining the DAO's vetting process, which is liable to result in the overvaluation of tokenized assets or even outright fraud.

On the other side of the equation, the risk of stability fee increases would require prudent Smart Vault holders to closely monitor fees. A crypto market boom is liable to cause a significant outflow of S-EURO, in which case the stability fee correction may be similarly significant. Smart Vault holders would effectively be penalized in an effort to encourage vault closure.. The passive Smart Vault holder may return months later to find exorbitant fees levied which must now be paid at stabilized S-EURO prices.. This strikes me as a substantial deterrent to asset holders who don't want to be bothered with constant monitoring of market conditions.

Furthermore - the S-EURO is in no way directly linked to the value of TST (which provides a vote in the DAO that oversees S-EURO).. We must consider the audience for this token which is primarily used to determine fees and approve tokenization proposals.. What is a vote in the DAO worth, and to whom? Stability fees are collected by the DAO, so dividends may provide a prospective draw to otherwise unbiased stakeholders.. Beyond these, what value is there in having a say in token issuance and fees if you aren't either a self-interested asset holder looking to get your asset tokenized / reduce fees for your tokenized asset, or a major user of the token (i.e. an exchange) looking to encourage stability? Who do we imagine holding TST, and to what end? We may dream of market experts and prominent business leaders benevolently taking the reigns and creating the stablecoin platform to replace all stablecoins, but what compelling reason do they have to opt for a DAO vote over its cash equivalent? I worry that the DAO will eventually be governed by the self-interested, and everyone involved will suffer for it..

Transparency isn't a strong point in the stablecoin domain, but this is at least partially offset by fairly clear accountability. Much as I can appreciate the use case and need for such a platform, I'm afraid I don't see how this project addresses issues of transparency and accountability in the stablecoin domain.