BOOSTING the VALUE of the $MIR TOKEN

$MIR appears to be undervalued … but there is also little “value” being currently created. We can change this as a community.

THE PROBLEM:
Those receiving $MIR rewards tend to dump once these rewards and airdrops are received, causing drop in the token price.

WHY?
With a slow-drip minting process, little value appears to be generated for holders.
Yes, the 0.30% generated by trading fees does get distributed back, in one way, shape, or form to holders of $MIR … BUT there appears to be a value issue.

 WHY IS THIS ... REDUX?
 Trading fees are not overly significant as a % of the liquidity available on the platform, so the APR generated in staking mASSETS and $MIR is largely generated by newly minted $MIR tokens.

HOW TO COMBAT THIS?
For an interim period, perhaps it would behoove the community to reduce the amount of rewards that are distributed to LPs as well as stakers by virtue of a buyback and burn process for the $MIR token. If, say, 0.10% of each transaction on the $MIR protocol were to be used to initiate a buyback and burn … who would actually be hurt by this process? … the answer here would likely be the long farmers of mAssets … but WOULD IT? given $MIR is being distributed AS the reward for adding liquidity, a buyback and burn would lead to an increase in the token price of $MIR, thus increasing the APR, presumably as much as just distributing newly minted tokens would.

 THE NUMBERS -- Help Plz with this by people who know more than I do about $MIR ... and defi as a whole, for that matter:
        **There must be a way to determine what the optimal distribution of tokens should be given the trading volumes relative to the minting process in order to effectively stabilize $MIR as well and disincentivize LP holders and governance stakers to immediately dump their rewards**

With the TVL on $MIR holding up significantly well, we have a kind of critical mass in this ecosystem that dwarfs the other synthetic platforms out there, though the other platforms tend to trade at higher “multiples” … New mASSETS being traded will clearly be lowering the APRs of long farming anyhow … so we are going to eventually see returns being normalized … and this is fine as we continue to bring new money into the platform.

Somebody plz point out the flaw in my logic.

Thanks,
If it’s your first day as a LUNAtic … YOU HAVE TO FIGHT

2 Likes

The value, of $MIR is something I have been considering lately.

What can I do with $MIR?

As far as I can tell my options are:

  1. I can HODL and stake it in Governance pool. This allows me to earn further $MIR rewards and I can vote.

  2. I can use it in MIR-UST Liquidity Pool to earn further $MIR rewards.

  3. I can use it as collateral in Minting and in opening a Short Farm position.

  4. I can sell it.

Perhaps I am missing other utility of the $MIR token, but with my limited understanding, this lack of reason to hold, along with increasing supply is a reason for the falling price.

It surprises me that when I claim $MIR rewards, the transaction fee is in UST rather than $MIR. I don’t understand why all transaction fees on Mirror are not paid in $MIR.

Slightly reduced earnings to potentially increase the price of $MIR strikes me as a good idea. Forcing transaction fees to be in $MIR may also impact the price positively.

3 Likes

Mirror doesn’t have its own AMM so attempting to siphon fees away from LPs would require creating a new AMM, which seems like a major commitment of future development resources to maintain. I only see that worthwhile if it were built like Uni V3 or Curve V2 to allow for highly concentrated liquidity, which mirrored stocks desperately need.

I second this. I still think 1-4 are otherwise good reasons for it to be valued higher.

Also, rather than siphoning fees, could we not have a mirror rewards lockup feature, like we do with short farming, so whatever whales gain - say every two weeks - is part of the system for a sufficient period and effectively scarce, as well.

Alternatively, you might make the reward distribution less binary, so that system utility is incentivised. For example, receive some mirror in governance, which is locked for x amount of period. From there, those that may have wished to dump may now be invested in governance, whilst those who otherwise would’ve at least have to wait for some period of time.

1 Like