📖Introduction to Flat Money

A primer on flatcoins, Flat Money (UNIT), and the Flat Money protocol.

The Flat Money protocol allows people to deposit Rocket Pool ETH (rETH) and mint Flat Money (UNIT), a decentralized delta-neutral flatcoin designed to outpace inflation. The Flat Money protocol also offers Leverage Traders the ability to deposit rETH and open long positions on rETH’s spot price through perpetual futures contracts. Flat Money is the first protocol to offer end-to-end rETH exposure to Leverage Traders.

The future of onchain money will be built on Flat Money’s dual-market infrastructure.

What is a Flatcoin?

People need a better form of money that isn’t tied to any one fiat currency or exposed to fiat inflation.

A flatcoin is just that — a better form of money that can only be built onchain: uncensorable, inflation resistant and backed by decentralized collateral. It’s designed to outpace inflation and preserve your purchasing power. Most importantly, a flatcoin shouldn’t have any exposure to legacy offchain financial risks.

To learn more, listen to Brian Armstrong talk about the promise of the flatcoin asset class in the following Coinbase Ventures Request for Builders video 👇

Why Flat Money (UNIT) is the future

At Flat Money, we believe in the ETH Standard, or that ETH is the best store of value; staked ETH is pristine collateral that grows in value as adoption and usage of the Ethereum network grows; and liquid staking derivatives (LSDs) are the ideal backing for a scalable flatcoin.

When it comes to a unit of account, most DeFi users are still looking at their portfolio in USD terms instead of ETH terms. If you believe in the future of ETH and the Ethereum network, holding Flat Money (UNIT) allows you to hedge against volatility and accrue steady value in USD terms without losing value over time to inflation.

Instead of holding a stablecoin pegged to 1 USD that’s backed by centralized collateral, you can hold Flat Money — the first decentralized delta-neutral flatcoin backed by Rocket Pool ETH (rETH) and built on Base. It’s a purely onchain native currency that’s untouched by external financial dynamics.

UNIT is money that allows you to preserve your purchasing power and offset volatility within crypto markets. It addresses the issues people face when they hold fiat or stablecoins and provides a reliable financial alternative in an inflation-prone economy.

The Flat Money Protocol

Flat Money is an open source protocol where the future of onchain money will be built. The protocol doesn’t lock excess capital and can achieve 100% capital efficiency. Flat Money has limited exposure to other protocols, zero exposure to offchain assets, and zero external fees imposed on the system.

You can deposit rETH into the Flat Money protocol to:

1. Mint Flat Money (UNIT) and participate as a Flat Money (UNIT) Liquidity Provider (LP). UNIT is an ERC-20 native token minted on the Base blockchain.

2. Open a long position on ETH through perpetual futures contracts and participate as a Leverage Trader. Leveraged rETH positions are NFTs (ERC-721) minted on the Base blockchain.

For a more in-depth review of the Flat Money protocol, see the Flat Money Protocol section.