EDSD Stablecoin: The Rail-Native Settlement Currency

EDSD is purpose-built for trade settlement

Most stablecoins are designed for general-purpose payments: send a balance from one wallet to another and you are done. EDSD is designed for milestone-gated multi-party settlement. The buyer commits the full order value up front into a Locked state. The contract holds the balance against verified milestones. As each milestone PASSes, the corresponding tranche unlocks to the seller’s wallet. No EMT, no funds.

The backing is conservative. Roughly 75% of EDSD reserves sit in short-dated US Treasury bills (70 to 100 day maturities); the remaining 25% stays in cash for redemption liquidity. Reserve attestations are published per epoch using Proof-of-Reserves, the same primitive the protocol uses for milestone evidence. Anyone can verify backing independently against the published hash chain.

The unit of account is the US dollar. Operators in different jurisdictions can still settle in their local currency at the operating level; EDSD is the rail-internal settlement currency, the way SWIFT is the rail-internal messaging protocol for bank wires. Operating-level FX is handled by the operator’s own accounting; rail-level settlement is denominated in EDSD.

HOW EDSD MOVES THROUGH THE RAILFive states from buyer wallet to settled. Locked stays Locked until reality is proven; the state flip can only happen on PoV PASS plus EMT mint, never on a vote.

Commit1Buyer commits EDSD into the deal escrowOn deal acceptance, the buyer funds the full advance amount in EDSD. The protocol mints the Pre-Ship EMT, the receipt that the must-fund condition is satisfied. Until Pre-Ship EMT exists, no bill of lading is accepted into the rail.Pre-Ship EMT mints.edsd.commit(escrow) fires.
Locked2EDSD sits Locked across milestone tranchesFunds split into per-milestone tranche slices. While Locked, approximately 75% of each tranche is swept into short-dated T-bills (70–100 day maturity); 25% stays cash for redemption availability. Buyer cannot withdraw; seller cannot draw early.Treasury sweep fires. Proof-of-Reserves attestation per epoch; interest accrues to the order ledger.
Pass3Attestor evidence clears the PoV GateAttestor submits evidence via proof.submit(evidence). The Gate evaluates the four conditions: quorum, role diversity, equality of evidence, one-claim exclusivity. Same evidence cannot finalise twice. Buyer review window is 0–4 hours (governed).PoV PASS recorded. Receipt updates with PoV hash and claim_id.
Unlock4Tranche flips Locked to UnlockedsettleTrancheOnPass fires inside the same transaction: calculates the tranche amount, deducts the 0.5% protocol fee (capped), burns 50% in $EDM atomically, mints the milestone EMT, calls EDSD.unlock. Locked sub-slice becomes Unlocked sub-slice.EMT mints, tranche unlocks. Burn hash posted on the Receipt.
Routed5Tranche routes per the signed contractRepayment slice routes to the financier per contract terms; net proceeds to the operator; accrued T-bill yield routes per deal config. Webhooks fire to ERP/treasury systems. Latency from PoV PASS to participant wallet: seconds.Receipt v1 emits. Webhooks: trade.release.posted, fee.burn.posted, treasury.interest.accrued.

Five states the buyer's EDSD passes through, from commit to routed. The Locked-to-Unlocked transition happens only on a PoV PASS plus EMT mint, never on a vote or override.

What makes it different

Locked EDSD earns yield

Funds held in Locked EDSD aren’t idle. The treasury holds backing assets at roughly 75% short-dated T-bills (70-100 days) and 25% cash. Interest is reported in the ledger with Proof-of-Reserves attestations. Operators don’t see this in their wallet; it’s a protocol-level mechanism that pays for the rail’s operating costs and reduces fees over time.

Exceptions handled in-place

If something’s off (seal number doesn’t match packing list, QC fails 3 of 40 lots, customs flags a duty discrepancy), only the affected slice pauses. EDMA opens a case, logs the variance, shows the fix path, and applies the contract’s variance math. Paid slices stay paid. The trade keeps moving.

Governance can't disable the brakes

Some parameters are governance-adjustable within published bounds via 72-hour timelock: milestone templates, evidence checklists, attestor SLAs, treasury split. Others are untouchable: no-EMT-no-funds, must-fund-before-shipping, Locked-to-Unlocked-only-on-verified-proof. These are the brakes the protocol cannot disable.

LOCKED EDSD EARNS YIELDWhile funds sit in escrow (typical lock duration 30 to 90 days), the protocol does not let capital idle. Approximately 75% sweeps into short-dated T-bills; 25% stays as cash for redemption availability.

Locked tranche · example$30,000M01 On-Board tranche from a $100K deal, Locked for 60 days while the goods ship and clear customs.

Short-dated T-bills$22,500

70 to 100 day maturity. Interest accrues to the order ledger as treasury.interest.accrued events. Yield routes per the deal terms (typical: net to operator at M04).

Cash reserve$7,500

Stays liquid to maintain redemption availability. Proof-of-Reserves attestation published per epoch on the explorer; auditors can verify cash plus T-bill positions in real time.

How the first card (Locked EDSD earns yield) actually works. Approximately 75% of each Locked tranche sweeps into short-dated T-bills; 25% stays cash for redemption. Interest accrues to the order ledger with a published Proof-of-Reserves attestation per epoch.

Two paths, one trade

The v1 path uses bank rails for the cash leg. EDMA tracks the operational milestones, EMTs mint per gate, evidence is hashed and anchored on-chain, financiers and auditors get the verified trail. The cash itself still moves through correspondent banking. This is the practical default for the first wave of operators: the operational side is on EDMA, the money side is still SWIFT.

The v2 path uses EDSD end-to-end. The buyer funds Locked EDSD up front. Each milestone proof unlocks the corresponding tranche directly to the supplier’s wallet. No correspondent bank intermediary, no five-day wire lag, no FX spread layered on top. The trade lifecycle in software and the cash settlement become the same event.

Operators choose per deal. Some clients aren’t ready for stablecoin. Some are. EDMA is built so both paths run on the same operational ledger. The v2 path costs less and settles faster, so it gets adopted when both counterparties are ready. The v1 path is the bridge that lets operators start using the rail today without forcing their counterparties onto something new.

TWO PATHS, ONE OPERATIONAL LEDGERv1 uses bank rails for the cash leg with EDMA tracking operational milestones in parallel. v2 uses EDSD end-to-end with the cash and operational leg fused into one event. Operators choose per deal; both paths run on the same rail.

v1 · Bank-rail cash legBridge for traditional counterparties

1Buyer issues a Letter of Credit through their bank; seller's bank confirms it.Cash leg · bank rail
2EDMA tracks operational milestones in parallel: order, production, inspection, customs, delivery.Operational leg · EDMA rail
3Each milestone proof mints an EMT and emits a hashed receipt anchored on L1. Financiers and auditors get the verified trail in real time.On-chain anchor
4EDMA milestone proofs trigger the documentary release events the LC needs; cash moves through correspondent banking on the bank rail.Documentary release
5Seller receives cash via SWIFT, T+2 or longer depending on correspondent chain.Settlement on bank rail

What you get: the trade becomes auditable and machine-readable without forcing counterparties off LCs. The bank intermediary cost stays; the verification cost drops.

v2 · EDSD end-to-endRail-native, both counterparties on EDSD

1Buyer commits the full advance amount in EDSD into escrow. Pre-Ship EMT mints.Must-fund · edsd.commit
2EDSD sits Locked across milestone tranches; 75% swept to T-bills, 25% cash reserve. Proof-of-Reserves per epoch.Locked state · treasury sweep
3Each milestone PASS fires settleTrancheOnPass atomically: tranche calc, 0.5% fee, 50% $EDM burn, EMT mint, EDSD unlock.Atomic settlement
4Tranche routes directly to the seller's wallet (or to the financier per contract). No correspondent bank, no SWIFT, no five-day wire lag.Direct routing
5Receipt v1 emits with PoV hash, burn hash, evidence trail. Webhooks fire to ERP. Latency: seconds.Settlement on rail

What you get: the trade lifecycle in software and the cash settlement become the same event. No FX spread layered on top, no five-day wire lag, no manual reconciliation. Costs less, settles faster.

v1 bank-rail (cash via SWIFT, EDMA tracks operations in parallel) vs v2 EDSD end-to-end (cash and operations fuse into one atomic event). Both paths share the same operational ledger; operators choose per deal based on counterparty readiness.