The trading volume of Mirror Protocol US stock synthetic assets increased by 1051.5% in two months, and liquidity increased by 777.26%.
Original title: “How much demand for U.S. stocks in the currency circle? 》
Author: Block Rhythm
Throughout the world, the US stock market is still the most liquid and topical investment market.
On January 28, Robinhood, the favorite brokerage platform for young Americans, and a number of local brokerages in the United States successively announced restrictions on the opening of GME, AMC and other stocks. At this time, the advantages of the decentralized trading platform are brought into play.
Mirror Protocol, the DeFi protocol that currently has the largest U.S. stock synthetic asset market, initiated a vote and launched GME and AME stock synthetic asset trading. As of press time, GME and AMC have voted. GME has received approximately 1.51 million votes in favor and 106,000 votes against, and AMC has received approximately 1.51 million votes in favor and 69,900 votes against.
Now, how much demand is there for US stock trading in the cryptocurrency industry?
Analysis of Mirror Protocol casting US stocks
Mirror uses Terra stable currency “UST” or mAsset to over-collateralize to mint U.S. stock synthetic asset tokens. The minimum mortgage ratio for UST is 150% and the minimum mortgage ratio for mAsset is 200%. U.S. stock synthetic asset tokens minted by pledge can be traded on Uniswap and Terraswap.
At present, the price of mAsset is fed every 15 seconds through Band Protocol’s oracle to ensure that the price of mAsset is consistent with the traditional market.
Of course, the design idea of ​​Mirror Protocol is ideal. However, in actual operation, mAsset has a premium compared to the US stocks in the traditional market. Among them, mTSLA (Tesla US stock synthetic asset) has the highest premium, about 25.72%.
At present, some users have proposed that when the premium exceeds 10%, users of synthetic US stock assets will be rewarded with more mAsset, and the price will be stabilized by increasing the supply. However, the proposal currently has only 1,255 votes in favor and 35,369 votes against it.
The main reason for this is that Mirror Protocol does not provide enough incentives to stimulate users to cast mAsset and there is no better way to arbitrage the two markets.
Many users in the Mirror Forum have paid attention to this matter and have proposed a variety of solutions. Rhythm BlockBeats has compiled several reasonable solutions:
Reduce agreement fees. The current agreement fee is 1.5%, and reducing it to 0% or 0.1% will help arbitrageurs reduce the cost of synthetic assets;
Reduce the minimum excess pledge ratio. The current rate is at least 150%, and most users believe that the reduced rate should be between 105% and 110%;
Stabilize the price of UST or issue more USTs. UST is an algorithmic stable currency issued by Terra, but its price is not fixed at 1 US dollar or 1 USDT, but determined by the Terra system token LUNA. Due to the small supply of UST, the fluctuation of UST is relatively uncontrollable. Forum users said that when the supply of UST increases, the premium will decrease. Some users said that if UST can be minted through ETH or BTC, then the liquidity and price of UST can be more stable.
After 2 months of development, how big is the trading volume of US stocks on decentralized platforms?
Two months ago (December 9, 2020), Rhythm BlockBeats calculated that the trading volume of the top 13 U.S. stocks synthetic assets of Mirror Protocol in a single day was 1.716 million UST, and the liquidity was 15.1 million UST. At the same time, these 13 U.S. stocks are in the traditional The daily trading volume of the securities market was US$78.6 billion.
Two months later, Rhythm BlockBeats counted the same data again:
Compared to two months ago, the trading volume of synthetic assets on Mirror’s US stocks has increased by 1051.5%, and liquidity has increased by 777.26%. Of course, compared with US stocks, Mirror’s trading volume is only 0.022%, and the overall volume is still in the development stage.
According to official information, Mirror is cooperating with Mask Network and is committed to introducing U.S. stock synthetic assets into Twitter. Users can directly buy UST and convert them into mAsset using fiat currency directly on Twitter through the channel provided by Transak.
At the same time, Mirror will also bring synthetic assets to the Binance Smart Chain.
After the brokerage restricted GME trading, more people realized the importance of decentralized synthetic asset trading. Of course, there are still many problems with decentralized synthetic asset trading, but as The Difiant columnist Owen Fernau said, providing US stocks on-chain settlement will be the next holy grail of DeFi.
Source link: www.theblockbeats.com
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