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🐋 Minting

Chiss-native stablecoins (e.g., chJPY, chTRY, chNGN) are fiat-backed digital representations of local currencies, minted and managed through a controlled on-chain treasury system. Minting access is permissioned ensuring that all circulating supply is fully backed by off-chain fiat reserves held by approved Facilitators.

Key Participants​

  1. Treasury Manager The Facilitator network manager is also the Treasury Manager. In minting, the manager is responsible for executing actual minting and burning operations. It is the only entity capable of directly minting Chiss-native stablecoins from a Facilitator's treasury balance, ensuring that no other actor can arbitrarily inflate supply.
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The Facilitator treasury is the minting allowance a facilitator has based on its committed capital. It's a minting inventory that can increased & reduced by the treasury manager.

  1. Facilitators Facilitators maintain fiat reserves in their custody and act as entry and exit points for users. They do not mint stablecoins directly, instead, they receive a adjustable minting allowance (or capacity) from the Treasury Manager. This allowance defines how much stablecoin can be minted to fulfill their operations, based on the fiat capital they have verified off-chain & committed.

  2. Users End users (businesses or individuals) interact only with Facilitators. The user can either make an off/on-ramping or FX transfer transaction request via the facilitator interface. For all transactions, the user makes a deposit of fiat or protocol-native stablecoins to initiate the transactions.

Minting Flow​

  1. Capital Commitment A Facilitator commits fiat capital off-chain for Chiss Protocol operations. The treasury manager validates the deposit for every facilitator joining the network. Initially, this will be the capital that serves as security stake to prove commitment & guarantee good behaviour.

  2. Treasury Assignment The Treasury Manager grants a (un)leveraged minting allowance to the Facilitator after commitment validation. This is the Facilitator's treasury. The balance of this treasury indicates the maximum limit of the amount of tokens the Facilitator can request to be minted by the treasury manager to fulfill operations.

  3. Minting & User Ramping When a user on-ramps, i.e. buys chJPY with JPY, the Facilitator automatically requests the treasury manager to mint & transfer tokens to the user's wallet address. The amount of tokens minted is deducted from their treasury balance. By this approach, it can be seen that Chiss-native stablecoins are backed 1:1 by user deposits across all facilitators with the commitment fee acting as an additional cushion.

  4. Burning & Reconciliation When a user off-ramps (redeems chJPY for JPY), the Facilitator receives the stablecoin & automatically burns it through the Treasury Manager to reduce the stablecoin supply & increase its treasury balance. The corresponding fiat is then released from the Facilitator’s custody to the user, maintaining 1:1 parity between minted supply and fiat backing.

Minting Capacity Control​

Each Facilitator’s minting capacity is dynamically managed by the Treasury Manager, who can:

  • Increase treasury balance for facilitators with higher commitment, proven reliability or to reflect protocol debt.
  • Reduce or revoke treasury balance in case of irregularities, compliance issues, misuse or reflect facilitator debt.
  • Pause minting privileges system-wide during security or market anomalies. This model ensures minting capacity always reflects actual fiat liquidity in the ecosystem, maintaining solvency and transparency.

Advantages of the Model​

  • Strict Minting Discipline: No direct mint access by facilitators; all minting is performed by the Treasury Manager.
  • Real-Time Accountability: Each minted unit can be traced to a specific facilitator and corresponding fiat reserve.
  • Scalable & Modular: Multiple facilitator treasuries can exist per currency corridor without central bottlenecks.
  • Onchain Auditability: All minting, burning, and allowance updates are visible on-chain for public verification.