In this article, we introduce some of the main characteristics of Angle’s agTokens.

• All agTokens are 100% redeemable against multiple collaterals

• Hedged and over-collateralized

• agTokens can be staked to earn ANGLE governance tokens

• Each agToken can be pegged to potentially any value

agTokens are issued at oracle value directly when users interact with the protocol. Thanks to that, there is virtually an unlimited liquidity when minting agTokens, and no slippage even for large amounts as opposed to traditional AMMs. Additionally, agTokens are not borrowed from vaults, and don’t need to be paid back with interest like DAI on Maker.

agTokens are always redeemable at a 1:1 rate against accepted collateral in the protocol. At the beginning, the protocol will support agEUR as agToken, and USDC and DAI as collateral. wETH and wBTC should follow quickly, and the plan is to open the protocol to new collaterals in the future. In theory, any token or asset could be accepted as collateral to mint and back agTokens.

In addition to the collateral used for minting, agTokens are backed by capital from SLPs (Standard Liquidity Providers) and HAs (Hedging Agents). SLPs deposit their funds into the protocol, and earn yield for over-collateralizing it. HAs deposit funds as margin, and are able to open leverage long positions on the collateral in the protocol, hedging it against price changes. Thanks to these two types of agents, agTokens are over-collateralized, and the collateral price changes are hedged by HAs, always ensuring they are convertible against collateral.

After launch, agTokens can also be staked to earn ANGLE governance tokens. They will be used to vote for proposals and decide on the future improvements of the Angle Protocol.

Another advantage of Angle is that it can issue stablecoins pegged to potentially any value, as long as it has a price relationship with other assets. This means that even if the protocol starts by issuing classic fiat-pegged stablecoins, like agEUR or agUSD, it could follow up with more interesting products like baskets, indexes, or assets that don’t suffer from inflation.