Cryptocurrencies like Bitcoin and Ethereum have revolutionized the way we store and transfer value on the internet.
However, they suffer from extreme price fluctuations that make them unsuitable for everyday transactions and long-term savings. That’s where stablecoins come in.
[Image Source: Coinbase]
Stablecoins aim to provide the best of both worlds: the stability of fiat money and the flexibility of crypto.
But they come with a problem..but what’s that?
It’s quite simple!
When you hold a stablecoin, you’re not earning anything on your holdings. In fact, you’re incurred by inflation on your currency. In other words, you’re losing money in a long enough time frame as long as you keep stablecoins in your wallet.
But we have a solution.
We at MetaProtocol are about to change the stablecoins scene with our new state-of-the-art stablecoin mUSD.
What Exactly is mUSD?
$mUSD is a crypto token pegged to the US Dollar but supported by $GLP, the underpinning token of GMX, the largest DeFi protocol on Arbitrum.
Just by holding mUSD:
- You earn an interest in your crypto wallet by getting a steady APY of around 20%
- You also get the opportunity to tap into DeFi strategies to further boost your yields.
This way, you get to enjoy the stability of traditional stablecoin while simultaneously protecting your wealth from inflation and exposing yourself to more yield-generating opportunities in the crypto-verse.
How Does mUSD Work?
- You can use the $GLP as collateral to mint $mUSD tokens inside the Meta Protocol.
- The $GLP submitted as collateral on Meta Protocol earns APR every week. The earnings are paid in $ETH tokens on Arbitrum, which are changed to $mUSD based on the $USD value of $ETH at that moment.
- A certain percentage of the earnings are shared equally among META holders, while the rest are given equally to $mUSD holders, with an average APR of around 20%.
- Moreover, as the price of GLP increases, the yield generated by $mUSD holders may also rise.
- Not only that, Meta Finance is different from other stablecoin protocols as it facilitates 0% minting fees. Meaning you can leverage your $GLP holdings and mint $mUSD stablecoins without additional costs.
Is mUSD Safe and Sustainable?
Meta Finance keeps $mUSD’s stability through various factors and ensures its peg with the dollar:
1. Over-collateralization: Each one $mUSD is supported by at least $1.5 worth of GLP tokens as collateral. This helps keep stability as the value of the collateral is more than the value of the $mUSD minted.
2. Liquidation Mechanism: The Meta Protocol has mechanisms to protect the platform from undercollateralized positions.
Say, a user’s collateral rate falls below the normal; any user can become the liquidator and buy the liquidated portion of the collateralized $GLP, paying in the proportional amount of $mUSD tokens.
3. Arbitrage Opportunities: As the $mUSD price deviates from its peg of $1, it creates an arbitrage opportunity for users to profit off of price discrepancies which automatically restores the $mUSD price back to $1 per token.
These factors amalgamate together to make $mUSD safe and sustainable in the long run.
Plus, Meta Finance protocol has several audits going on as of the date of writing this post.
The Meta Token
$META is the native token underpinning the META Protocol.
It’s an ERC-20 token that is going to be used for governance, voting, staking, minting, and issuing liquidators’ rewards.
The more META tokens someone has, the higher their veto power when it comes to decision-making for the META Protocol.
A total supply of 100,000,000 META tokens will be issued. Here’s what the tokenomics is going to look like
What’s Next for Meta Finance?
Let’s check out what the future holds. Presenting the Meta Finance roadmap.
As per the roadmap, the prelaunch sale, aka the IDO for the META tokens, is going to happen on July ##, 2023 (dates to be announced soon).
5% of META’s total supply, i.e., 5 million $META tokens, will be issued at a minimum rate of $0.16/META.
Participate in Meta’s quest to get whitelisted for the IDO.
That’s a wrap for today!
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