mStable (MTA) consolidates stablecoins, lending, and swapping into one standard.
Three main issues facing stablecoin users:
– Significant fragmentation in same-peg assets
– Lack of native yield as it is increasingly demanded by users
– Lack of insurance against permanent capital loss
SWAP, SAVE, and EARN products are specifically designed to address these problematic points.
mStable assets represent some fundamental value pegs and are minted/redeemed on the chain through smart contracts. mASSETS is supported 1: 1 by a basket of existing tokenized same-base assets.
Each mASSET is a share of liquidity for its asset, as well as a medium of exchange, a unit of account, and a store of value in its own right.
Each mASSET has native interest rate earned from lending bASSETS on third party lending protocols combined with the fees charged by mStable’s SWAP product.
What is MTA?
The Meta Protocol token (MTA) acts as insurance against permanent loss for all mASSETS. Meta holders can stake their tokens to become governor, allowing them to participate in the management of the system. To achieve the long-term value of Meta, these governors were motivated to seek stability through diversification and mStable growth.
Characteristics
Easy: mStable is the one-stop solution for stablecoin users.
Robust: Collateral is diversified, exterior to the system, and ultimately secured by Meta.
Stable: mStable’s liquid shares are assets that are tokenized in their own right.
Decentralized: Meta embeds the incentives needed to manage a decentralized system.
Built for fast scaling – 25% of the Meta is emitted in the starter reward pool.
Use cases of Meta
Yield and Return
- mASSETS earn an outsized yield (interest rate + swap).
- mStable is built so people who use it or contribute to its development will be rewarded for doing so.
Traders & Arbitrageurs
- Significant arbitrage opportunities exist using mStable’s Zero-Slippage Swaps.
Stablecoin users
- mStable publishes assets more securely than the sum of its parts. Each mASSET diversifies risks between different asset issuers and stabilization mechanisms. The system itself is effectively over-collateralized since every mASSET is ultimately supported by Meta.
SDK integrations
- dApps: mStable increases the dApp’s user base while increasing usability. mStable allows dApps to accept certain content while presenting them in a more user-friendly and secure manner. For example, with the mStable SDK, a dApp can accept USDC, DAI, TUSD, USDT, GUSD, USDx, CUSD, and display USD assets simply as USD.
- Futures exchange: instead of using a single stablecoin as the basis of the contract, accept and pay with multiple stablecoins. Reduced probability of mass liquidation due to coin’s peg loss stabilizes.
- Spot exchange: consolidate liquidity stablecoin into one pair: BTC / USD instead of BTC / USDT, BTC / USDC, etc.
- Participating dApps and exchanges receive Meta.
Features
Minting and Redemption
- Minting
Each mASSET will use a smart contract to facilitate the mining and redemption and holding of its collateral.
– To mint mStable content, the user calls the minting function of that mASSET contract.
– Then the user sends any basic whitelisted token to that asset’s smart contract.
– A minting is valuable if it does not push any of the bASSET collateral levels above their predetermined maximum weight.
Minting an mASSET offers optionality and immediate 1: 1 conversion of a bASSET to its corresponding mASSET.
- Redemption
-In contrast, users redeem their mASSET by calling the redeem function on the mASSET contract.
-Users can specify the bASSET they want to receive in exchange for their equivalent amount of mASSET (which will then be burned).
-Redemption is valid as long as the given bASSET (s) do not push any other bASSETs above their maximum weight. When redeeming for a single bASSET, an equivalent fee equivalent to the swap fee is charged.
-If bASSET has the maximum weight, the system will enforce “multi-proportional redemption.” For free, users get a proportional representation of bASSETS.
-This means that even in the case of a peg loss, the system remains in value without requiring oracles.
Swaps
Swapping is an exchange between one whitelisted bASSET and another at a 1: 1 ratio. Swap does not affect the number of mASSETS in circulation.
Native Interest Rate
mASSETS in the mStable ecosystem earns interest is the average rate earned on aggregated bASSETS plus platform fees.
Rewards
Get rewarded for being a contributor to mStable’s liquidity and utility
Re-collateralization
Each mStable asset is stronger than the sum of its shares. Re-collateralization protects the basket in case the bASSET losing its a peg
Meta Governance
mStable Governors have an in-game interface and will be responsible for setting and maintaining system risk parameters.
- Staking
The Meta Governors earn an income to compensate them for their voting decisions, responsibilities, and risks.
Team
James Simpson – CEO & Co-Founder
Henrik Andersson – Research & Co-Founder
James Eddington – COO
Conclusion
The mStable protocol aims to resolve fragmentation between same-peg assets, lack of native yield with other stablecoins, and incurring irregular losses when leveraged with Automated Market Makers (AMM) like Uniswap for liquidity.
The launch of mStable offers users a single, unified protocol for access to stability, savings, and liquidity for a basket of stablecoins. Given the rapid growth of stablecoins on Ethereum, the addition of mStable as a new alternative to access a wide range of money verbs (like saving, swapping, etc.) in a single application is quite appealing to a broader ecosystem.
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