ITSA lists RAI Stablecoin in Tokenbase

ETH total deposited collateral vs. time
Figure 1: Eth collateral locked over time (source:

How does RAI work?

RAI trades on the secondary market such as Uniswap or centralized exchanges. The token also offers a redemption price which is the RAI target price or the so-called moving peg.

  • Redemption price: The internal value of RAI in the system. In other words, the price to mint and repay RAI debt. In equilibrium, the redemption price should be equal to the market price.
  • Redemption rate: the rate of change of the redemption price. It can be measured as APR (annual percentage rate). The redemption rate can be positive or negative.
RAI market vs. redemption price — all time chart
Figure 2: Currently RAI price fluctuates +/- 2% of the redemption price. (source:

Secondary token (FLX)

Just like Maker, the RAI protocol has a secondary token called FLX. FLX has two main functionalities:

  1. FLX owners are the first line of defense in case RAI enters a death spiral. FLX is the lender of last resort in the system. Similar to the Maker protocol, the RAI system will have a surplus and debt auctions. Debt auctions will autonomously mint and auction new FLX to cover the loss.
  2. Ungoverning the RAI system: It sounds unintuitive, but the idea behind the governance token is to reduce the governance around the protocol and further decentralize all components of the system.

Challenges and risks

After we underwood the concept of RAI, there are a few questions that come to mind. Holding RAI while the system devalues the token can be considered a loss for the holder. Why would anyone hold RAI during devaluation? This would depend on the rest of the market. During devaluation would be more beneficial to hold a fiat pegged stablecoin like DAI. On the other hand, devaluation incentivizes users to open more CDPs because the value of the debt shrinks compared to the value of the collateral. An interesting use case for RAI is its use as collateral in DeFi. Since ETH can be too volatile and risky as collateral, RAI can be alternative collateral due to the fact that it dampens the price volatility of ETH and offers traders higher price stability. Looking at the charts, it seems that RAI is losing traction in the crypto market. The transaction volumes have been on a downtrend since inception, and the number of CDPs created is shrinking.

Weekly RAI transaction volume is dropping (chart)
Figure 3: Weekly RAI transaction volume (source:
CDPs created by day is dropping (chart)
Figure 4: CDPs created per day (source:

The classification of RAI according to the ITC:

RAI stablecoin ITSA Tokenbase entry
Figure 5: The RAI Tokenbase entry (Source: )

FLX token:

FLX governance token ITSA Tokenbase entry
Figure 6: Tokenbase entry of FLX token (Source: )

The International Token Standardization Association (ITSA) e.V.

The International Token Standardization Association (ITSA) e.V. is a not-for-profit association of German law that aims at promoting the development and implementation of comprehensive market standards for the identification, classification, and analysis of DLT- and blockchain-based cryptographic tokens. As an independent industry membership body, ITSA unites over 100 international associated founding members from various interest groups. In order to increase transparency and safety on global token markets, ITSA currently develops and implements the International Token Identification Number (ITIN) as a market standard for the identification of cryptographic tokens, the International Token Classification (ITC) as a standard framework for the classification of cryptographic tokens according to their inherent characteristics. ITSA then adds the identified and classified token to the world’s largest register for tokens in our Tokenbase.

  • The International Token Identification Number (ITIN) is a 9-digit alphanumeric technical identifier for both fungible and non-fungible DLT-based tokens. Thanks to its underlying Uniform Token Locator (UTL), ITIN presents a unique and fork-resilient identification of tokens. The ITIN also allows for the connecting and matching of other media and data to the token, such as legal contracts or price data, and increases safety and operational transparency when handling these tokens.
  • The International Token Classification (ITC) is a multi-dimensional, expandable framework for the classification of tokens. Current dimensions include technological, economic, legal, and regulatory dimensions with multiple sub-dimensions. By mid-2021, there will be at least two new dimensions added, including a tax dimension. So far, our classification framework has been applied to 99% of the token market according to the market capitalization of classified tokens.
  • ITSA’s Tokenbase currently holds data on over 4000 tokens. Tokenbase is a holistic database for the analysis of tokens and combines our identification and classification data with market and blockchain data from external providers. Third-party data of several partners is already integrated, and API access is also in development.


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RAI article cover photo



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International Token Standardization Association

International Token Standardization Association


The International Token Standardization Association (ITSA) is a not for profit organization working on holistic market standards for the global token economy.