> For the complete documentation index, see [llms.txt](https://whitepaper.nuon.fi/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://whitepaper.nuon.fi/abstract.md).

# Abstract

Price inflation remains one of the most understated issues for global stablecoin holders. 

According to US CPI, in the past 5 years, all assets kept in stablecoin lost 17% of value, and according to Truflation's CPI the loss was larger than 26%. 

There is \~$80 billion in latent stablecoins in DeFi, seeking protection from accumulated inflation. Those holders desire modest, reliable, low-risk returns but find defi protocols prohibitively risky and complicated.

On the other hand, those best to source reliable returns are crypto-natives: risk-seeking investors who demand high yields and are comfortable taking enormous risks to get them.

Nuon v2 bridges the gap between stablecoin holders seeking modest returns and crypto-native investors seeking high yields. 

Nuon v2 ensures stable inflation-hedging yields for NUON holders while rewarding nuMint governance token holders with the accumulated surplus yield generated from strategies that they vote to allocate capital towards.

Nuon v2 uses a lightweight veto-based governance system with optimistic security assumptions to enforce risk preferences while allowing any asset as a source of yield. The backstop function protects the protocol and ensures NUON holders at least the inflation-level yields,  also during times when inflation is higher than yields.