The problem USDNEAR Stablecoin solves

Fees: Stablecoins on Ethereum are hampered by astronomical fees. The fee to send DAI 100 could reach USD 15 or more. Ethereum fees make low-amount trading impossible. On the other hand, the fees on the NEAR blockchain are tenths of a cent, so minting USDNEAR and sending the tokens costs only a fraction of a cent.

Ease of use: NEAR accounts are "named accounts" where users choose their account name, e.g.: 'alice.near'. Having readable account names, very low fees, and a stablecoin are drivers for mass adoption outside of the crypto enthusiast circle. A stablecoin with fees less than a cent and readable account names becomes useful and usable.

Auto-paid Interest: Staked Near receives staking rewards every 12 hours (each NEAR Epoch), so the interest on the loan is paid from the staking rewards, the collateral naturally increases and never decreases. The whole process is transparent and automatic on NEAR Blockchain. Users can reap staking rewards and at the same time mint a stablecoin to operate without the volatility of the market.

Trust: We chose a simple design to make the system transparent, easy to understand, and highly reliable. The contract has a Conversion Window where USDNEAR owners can exchange their tokens for stNEAR from the collateral pool. The rate is fixed, so "1 USDNEAR" always equals "1 USD woth of stNEAR" at the current market price. The over-guarantee rate is 200%, so there is ample funds to feed the conversion window.

Challenges we ran into

We used to much time building the smart contract and thinking about contract tokenomics, so we only had enough time to complete a functional but very basic web App UI for the Hackathon.