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What is Meta Finance?
Meta Finance is a decentralized protocol dedicated to bringing stability to the cryptocurrency economy, allowing users to mint mUSD, an interest-bearing stablecoin using GLP as collateral.
What is the motivation behind Meta?
Meta Protocol aims to provide a secure, safe, and fully decentralized interest-bearing stablecoin that is not under any government's authority while benefiting GLP holders of all sizes.
Why have you chosen GLP as collateral?
GLP has several advantages over LSD tokens:
- 1.Price Stability: Since GLP is an index token, GLP price is more stable than just ETH
- 2.High Yield: GLP has historically given average APR of ~27% compared to ~4% of LSDs
- 3.High TVL: GLP has $500 Mn+ TVL, which is higher than many LSD tokens.
What are mUSD and META?
mUSD is an interest-bearing stablecoin hard-pegged to the US dollar, using only GLP as collateral with an excess collateral ratio of 150% to maintain safety and decentralization. mUSD generates stable interest powered by GLP.
META is the native token of META Protocol. META Protocol is managed by people worldwide who hold META governance and utility tokens.
How can mUSD stability be ensured?
mUSD stability is maintained through a combination of overcollateralization, liquidation mechanisms, and arbitrage opportunities. These factors work together to ensure that the value of mUSD remains close to its 1 USD peg.
What are the key benefits of Meta Finance?
- mUSD holders receive stable interest with a base APY of 20%+ (generated by generous GLP yield).
- Zero loan interest - There's no borrowing interest when minting (borrowing) mUSD, allowing users to go leveraged long on GLP tokens with zero loan cost.
- Governable - Meta Finance's contract are behind multi-sig and can only be updated via Governance. Redemption Fee, Keeper Reward, and META shared revenue can be modified according to the MetaDAO community, which does not affect Meta Vaults' security.
Does Meta charge any fees?
There are no borrow fees or interest on Meta Protocol.
How can I earn money using Meta?
There are four different ways to generate revenue using Meta Finance:
- Deposit GLP and mint mUSD to earn stable income in mUSD and rewards in META.
- Provide mUSD/2Pool liquidity on Curve Finance (Arbitrum) to earn META.
- Hold META to share Meta Protocol revenue.
- Become redemption provider to earn provider rewards.
- Become a Liquidator or Liquidation Keeper to earn liquidation rewards.
Why would I deposit my GLP on Meta to mint mUSD?
- 1.No borrowing interest: Unlike AAVE and MakerDAO, Meta does not charge any interest when minting (borrowing) mUSD. This can save you on interest expenses, making Meta a more cost-effective option for borrowing stablecoins.
- 2.Simplified collateral: Meta only accepts GLP as collateral, ensuring a secure and decentralized system. This simplicity might be appealing if you are primarily a GLP holder and want to avoid dealing with multiple LP token types.
- 3.Stable interest on mUSD holdings: By minting mUSD on Meta, you can earn a stable interest with a base APY of approximately 20%+ (powered by GLP yield). This interest is generated for holding mUSD, allowing you to earn a stable income while maintaining exposure to GLP through your collateral.
- 4.META rewards: By using Meta, you can earn META rewards in addition to stable interest income. Holding META tokens may offer additional benefits within the Meta ecosystem.
Is GLP the only collateral accepted by Meta Finance?
Yes, GLP is the only collateral types accepted by Meta to mint mUSD while maintaining safety and decentralization.
How can I mint (borrow) with Meta?
To mint (borrow) mUSD, you must deposit a certain amount of GLP collateral through Meta.
Then you can mint mUSD against your collateral up to a collateral ratio of 160%.
When do I need to pay my debt back?
Debts issued by Meta Protocol do not have a repayment schedule. You can repay your debt at any time, as long as you maintain a safe collateral rate.
What is Liquidation?
To ensure that the entire stablecoin supply remains fully backed by collateral, once your collateral rate falls below the safe collateral rate, you risk being liquidated at any time.
Borrowers (minters) with a collateral rate less than 150% must be liquidated to ensure that the mUSD stablecoin is fully backed by the collateral asset.
The borrower's (minter's) debt is reduced, and liquidators receive the collateral asset in exchange for paying off the debt.
After liquidation, the debt owed by the borrower (minter) has been paid, and the value of the liquidated collateral equals 110% of the reduced debt.
Can I withdraw my deposited GLP whenever I want?
As a general rule, you can withdraw your deposit at any time. There is no minimum lockup duration.
I'm a holder of USDT, USDC, FRAX, and/or other stablecoins; how can I get stable interest with Meta?
It's easy! Swap your held assets to mUSD through any DEX (such as Curve Finance). As long as you're holding mUSD, stable interest is calculated and distributed by Meta Protocol.
What oracle are you using to determine the price of GLP?
I used "Redeem mUSD", but the debt on "Repay mUSD" remained the same. Why?
Redeem mUSD and Repay mUSD are two separate systems. Redeem mUSD is where you exchange your mUSD for a 1:1 USD worth of underlying GLP. You would want to use this function when there are arbitrage opportunities. For example, when mUSD is below $1 USD, you can buy it on the market and redeem it for underlying GLP tokens. By doing so, you make arbitrage gains, and as more people buy mUSD to redeem, it helps to re-peg the mUSD price to $1 USD.