1. What is RAI?

Introduction to RAITokens

RAI (Rai Reflex Index) is a type of Token based on smart Futures, designed to maintain price stability through a preset algorithm. Unlike other Tokens, RAI's price is combined with one or more external indicators to ensure its value remains relatively stable.

The main features of RAI include:

1. Algorithmically Adjusted Interest Rate: RAI maintains its price stability by algorithmically adjusting the interest rate. When the market price differs from the target price, RAI will adjust through the "redemption rate."
2. Smart Futures Foundation: RAI's design is based on smart Futures, ensuring its operation is transparent and reliable.
3. Stable Value: RAI's price combines with external indicators, aiming to maintain its value's relative stability.

In summary, RAI is a Token designed to provide stable value, achieving this goal through smart Futures and algorithmic adjustments.

2. Who founded RAI?

According to the information provided, RAI Finance and the RAI stablecoin are two distinct projects.

1. RAI Finance: According to the information, RAI Finance is a decentralized finance (DeFi) project based on the Polkadot blockchain, and its founding team includes Chief Technology Officer Minkyu Cho among others. The project's goal is to address liquidity issues and other problems in the existing decentralized finance ecosystem.

2. RAI Stablecoin: According to the information, the RAI stablecoin is a new type of algorithmic stablecoin launched by Reflexer Labs, with founders including Ameen Soleimani and Stefan Ionescu. The project aims to build a decentralized, stable, and non-Fiat pegged stablecoin.

3. Which venture capital firms invested in RAI?

According to the information provided, the following venture capital firms invested in TokensRAI (Reflexer Labs):

1. Paradigm: In August 2020, Paradigm led a financing round of $1.7 million.
2. Pantera: In February 2021, Pantera and Lemniscap led a financing round of $4.41 million.
3. Lemniscap: In February 2021, Lemniscap and Pantera led a financing round of $4.41 million.

4. How does RAI work?

Mechanism of RAITokens

RAI is an algorithmic stablecoin developed by Reflexer Labs. Unlike traditional stablecoins (like DAI), RAI is not pegged to any fiat currency (like the dollar), but instead maintains its stability through algorithmic price adjustments.

Main Features

1. Floating Price: RAI's price is not fixed but adjusted according to market demand and supply. The goal is to control price fluctuations through algorithms to maintain relative stability.

2. Redemption Price and Rate: RAI uses a "redemption price" and "redemption rate" to control its price. The redemption price is RAI's target value, while the redemption rate is calculated based on the difference between the market price and the redemption price.

3. Negative Interest Rate: RAI allows for negative interest rates, meaning that when the market price exceeds the redemption price, RAI holders may face a decrease in value, while borrowers may expect a reduction in debt value.

4. ETH Collateral: RAI exclusively accepts ETH as collateral, reducing counterparty risk.

5. Decentralized Governance: RAI's governance model is decentralized, allowing holders to participate in decision-making and propose improvements.

Operational Process

1. Minting RAI: Users can mint RAI by depositing ETH, maintaining a minimum collateral ratio to avoid liquidation.

2. Price Adjustment: When the market price differs from the redemption price, the RAI protocol adjusts the redemption rate to influence the price. A negative interest rate lowers RAI's attractiveness, pushing its market price down, while a positive interest rate increases its attractiveness, pushing its market price up.

3. Market Balancing: By continuously adjusting the redemption rate, the RAI protocol aims to maintain a balance between market price and redemption price for price stability.

In summary, RAITokens provide a new stablecoin solution through its unique algorithmic mechanism and decentralized governance, aiming to reduce price volatility and enhance market stability.