Collection of changes for v2

Sure. I don’t understand how this solves the mAsset premium problem though.

So some of the people that would have just bought on the market would now mint. That will have an impact on the price.

Another possible way to incentivize minters is to possibly allow them to get an airdrop of a future token.
I feel minters are the people that make the whole platform work and therefore should be incentivized to mint. Instead they not only have to lock up 150-200% capital during the biggest bull run ever seen, they also get charged a 1.5% fee when burning their m-assets. (don’t get me wrong I think the burning cost is good as it stops people burning m-assets)

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In an old topic I was suggesting that the premium is mainly an effect of high farming rewards. It can go away just with an increase of pools (new massets) faster than mir value increase.
My suggestion is to start to register parameters of the whitelisted new assets in a pool using community funds (to propose the param registration poll in governance) and release them when looks ‘necessary’ (example when the spread seems to be too high we could decide very fast to add 5 massets: they would be ready and tested in the pool).
We have a lot of whitelisted assets but it looks we have somehow forgotten about them …

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Mirror v1 key problems

  1. Premiums persist : mAssets consistently trade at a premium to underlying stocks. There is little incentive for users to try to bring them down
  2. New assets dilute liquidity rewards : new assets being added dilute liquidity incentives of existing pools

I think listing more mAssets will fix this issue. Currently there is no incentive to sell or mint mAssets for a three reasons: (1) The overall trajectory of the markets is upward, (2) large cap stocks are not volatile and (3) the LP rewards are too high. In this situation there is no risk. Even if the mAsset fell by 20% which is extremely unlikely in this environment the LP rewards would more than compensate for that loss. As a result, it is capital inefficient to mint and provide LP with your minted token and nobody will sell an mAsset when there is no real risk. In this environment premiums will persist. If we list more mAssets the LP reward will fall, there will be risks to providing LP and people will start trading mAssets as intended.

I would also suggest modifying the LP rewards structure. LP rewards should be more weighted to trading volume of a specific pool. It makes sense to have some base MIR rewarded to each pool as we have now just to maintain pools for the assets but we should be incentivizing people to provide LP to pools that are actually used. This way as we list more mAssets LP rewards can still be high enough to attract providers to the platform for the right mAssets. The LP farming dynamic will be important overall to maintain interest in the project in the near term and this will maintain that feature as we add mAssets.

Adding mAssets is essential to the long term success of the platform and in terms of competitive advantage to other platforms that offer similar services. We need to think of a way to do that efficiently and while also maintaining LP incentives. I think the above is a step in the right direction.

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I made a separate post here on how we could reduce premiums:

If we allow staked LP tokens to be used as collateral thann people could supply liquidity without pushing the price above peg, because they could just mint the asset they put in the liquidity pool and used that staked liquidity as collateral for the minting. These market makers would be market neutral, but be on the hook for impermanent loss.

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The one thing that is missing from a trading perspective is the ability to short assets. This would be a deal breaker for many traders unfortunately but perhaps not such a big deal for hodlers and stock value investors. Inverse assets was mentioned as one possible method to fix premiums.

I’m not sure how possible it is but ideally you want a smart contract that works like a perpetual futures contract. So an oracle will provide a price and if the asset is priced above the oracle price then margin longs pay shorts a funding payment and visa versa. The larger the imbalance between net position volume short and long the larger the hourly funding payment for anyone with a margin position providing an incentive for the synthetic asset price to return to the oracle price.

I expect this would be quite difficult to implement unfortunately.

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@dokwon

For newest spec of Pre-IPO assets, please see here

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I have suggestion about Premium problem.
The real problem is no real chance for arbitrage when the Terra price is too premium. Example the arbitrager will sell at Terra price and buy at real world so they hope that the Terra price will come down after that they will buy in Terra and sell in real world. These will finish the strategy.

In fact that, It’s not gonna happen in Terra world because the valuation of stocks in terra are more higher than the real world. Ex. BABA in real world have a little dividend, it makes valuation BABA in long term about 240-260$ depend on opinions but BABA in Terra have a lot dividend from staking so the valuation is about like 1000$ maybe more. So the terra price is undervalue like now so no chance for arbitrager.

Solution
We need to give benefit in reasonable. We need to add staking reward for minter side 1.5 time of buyer side. Example we buy BABA in terra price for staking assume at that time APR is 100%, as the same time if we mint BABA for staking, the APR for minter should be 150%. If we can do this fundamental staking reward for minter side and buyer side, the arbitrager could take benefit when the price is premium.

Why should APR staking of minter side be 1.5 time of buyer side?
Example we buy BABA value 100$ and pool with UST value 100$ for staking APR 100%. It’s mean we invest in BABA-UST(LP) 200$ for reward 200$ per year.
In the same benefit for minter side, we mint BABA value 100$ so give collateral 200$ (assume collateral ratio 200%) after that we give BABA value 100$ to stake. Totally we invest 300$ for staking BABA-UST(LP) value 200$ so The APR of minter for staking should be 150% what it’s mean we will get reward 300$ per year for total invest 300$. These make fare for minter side and buyer side.
If we do like this, the terra price will diff from Oracle price around 1.5% in long run. Because if it premium, nobody wants to buy, they will come to mint for staking. That mean more supply and no demand so Terra price will come down in long run economic. So the arbitrager can happen because they can sure that the terra price will come to no premium in nature of these fundamental.
These just my opinion. It’s a concept. I hope it can help team. If it happens, many people will come to arbitrage a lot. But if it’s not change, A lot of people will come to buy a lot whatever premium +30% or 50%.

Isn’t minting and selling equivalent to shorting?

Not only is it currently possible to short, a new mechanism that we are working on will allow for a similar balancing mechanism that he is describing.

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@Sihyeok Could we pin this thread in the forum? Want it to stay at the top

Also could you give me admin status too so i can do it without having to ping you?

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Added comments about migrating shuttle to a more decentralized bridge - Wormhole

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when will the details be made public ? I think we should be careful about hpow we tweak reward distribution there is a risk that some mAsset have no liquidity and become ZOMBIE mAsset.

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  1. Low incentive for gov participation

There are more than 11 million Mir staked in governance, but only a minority of people vote on the different proposals. Whitelist of the S&P Index Fund is straggling to pass! I believe we need to change this in order to have more active and vital governance.

Nonvoting Mir staked in governance should have no right or reduced right to staking rewards. We may think of different options:

Nonparticipation in voting activity for more than a week, if during that period proposals are up for a vote, takes away the right to receive staking rewards.

Or we may scale down the right to staking rewards as more weeks elapse without any voting participation. An example

No vote for 1 week results in a 33 % reduction in staking rewards
No vote for 2 weeks results in a 66 % reduction in staking rewards
No vote for 3 weeks results in a 100 % reduction in staking rewards

I believe that reduction in staking rewards for nonactive stackers is fair for people who actively participate in the evolution of Mirror Protocol and a premium for the locking period that a vote implies.

  1. Listing process is too slow

Since if we implement “no vote no reward” is implemented, more people will participate. If a quorum of 20% is reached we may think to pass the proposal before the end of the 7 day period.

If a whitelist pass and an oracle different from Band Protocol is not suggested with the whitelisting, then maybe there is no need for a 7 day parameter registration.

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After/At the same time the reward balancing mechanism is introduced, we can introduce a minting fee in order to increase and stabilize MIR staking awards.

This can be considered to gather with Proposal to reduce mAsset burning fee

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I think maybe a cost-free solution could be to make it easier for users to see when it would be profitable to mint and burn mAssets, like a profitability indicator (that takes into account the fees for all transactions needed to mint and burn) or a simulator to test things out without using real tokens at first. There would be some effort required to implement it but it could pay off over time if more users mint and burn more mAssets

I have just read this on Twitter, it sounds interesting

Impermanent Loss Protection is coming to THORChain. We love Bancor’s design, so we’re implementing that. 100 days, 1% per day protection, RUNE paid from Reserve to back-stop LP capital on redemption. Only applies to active pools

I’ve been thinking of some projects that we could create on non terra block chains to help improve liquidity in secondary markets , it would be very useful if v2 supported cross chain community spends. Should be fairly easy to implement, the main missing feature just now is the lack of ability to define memo for community spend proposals.

Why cant folks simply receive funds on terra and move them over