About Mirrored iShares Gold Trust
Mirrored iShares Gold Trust is a DeFi protocol powered by smart contracts on the Terra network that enables the creation of synthetic assets called Mirrored Assets (mAssets). mAssets mimic the price behavior of real-world assets and give traders anywhere in the world open access to price exposure without the burdens of owning or transacting real assets. The minting of mAssets is decentralized and is undertaken by users throughout the network by opening a position and depositing collateral. Mirror ensures that there is always sufficient collateral within the protocol to cover mAssets, and also manages markets for mAssets by listing them on Terraswap against UST. The Mirror Token (MIR) is minted by the protocol and distributed as a reward to reinforce behavior that secures the ecosystem.
Mirrored iShares Gold Trust With it, Mirror ensures liquid mAsset markets by rewarding MIR to users who stake LP Tokens obtained through providing liquidity. Also to incentivize users to ensure mAssets to mimic the price behavior of real-world assets, users who stake sLP Tokens obtained through shorting mAssets are rewarded with MIR.MIR is valuable as it is can be staked to receive voting privileges and to earn a share of the protocol’s CDP withdrawal fees. Mirror is a project developed and steered by its community: its markets are maintained by its own users through MIR incentives, and the protocol evolves with new ideas through democratic governance.
Mirrored iShares Gold Trust Storage Key Points
|Coin Name||Mirrored iShares Gold Trust|
|Circulating Supply||1,123,877.69 mIAU|
|Source Code||Click Here To View Source Code|
|Explorers||Click Here To View Explorers|
|Chat||Click Here To Visit|
|Whitepaper||Click Here To View|
|Official Project Website||Click Here To Visit Project Website|
How It Works
To mint a Mirror asset (mAsset), an issuer must lock up > 150% of the current asset value in Terra stablecoins OR mAssets as collateral. If the value of the asset rises above the collateralization threshold, the collateral is liquidated to guarantee solvency of the system.
To target the price of the mAsset, the system reads in underlying asset prices via a decentralized price oracle – prices are updated every 30 seconds. When the price of the mAsset drifts significantly from the primary market, traders are incentivized to purchase / sell the asset to mint / burn to claim the collateral.
To burn a mAsset, the issuer must burn the equal amount of mAssets issued when opening the CDP – the collateral is then returned to the issuer.
On first launch,
mirrorcli will generate a
~/.mirrorclirc.json in your
$HOME directory, which will be used in subsequent sessions to specify settings such as LCD provider, gas prices for fee estimation, as well as contract addresses. It will come pre-configured with the official contracts for the mainnet version of Mirror on its
columbus-4 setting. The following instructions show you how to modify settings using the
tequila-0004 network by default:
Each network config should define how to connect to the Terra blockchain via LCD parameters. Each network configuration should point to the correct Mirror core contract addresses.
Coming into Mirror Protocol v2, there are new feature additions which supplement existing mechanisms from v1 so that all classes of users are sufficiently incentivized for their given contributions within the protocol.
Governance plays a crucial role in the decision-making and success of the Mirror Protocol, but users were not sufficiently incentivized to actively participate. As a result, the quorums were often not reached as users were disincentivized by the fact that their staked MIR tokens were locked until the end of the poll. This was further exacerbated by the fact that MIR deposits were mandatory to create new polls, so poll creators had a relatively high chance to lose their MIR due to lack of poll participation. In Mirror Protocol v2, active voters will be eligible for additional voting rewards in addition to existing governance staking rewards. An
ABSTAIN vote option is also added for users who want to participate actively in governance but feel that they do not adequately understand the proposal. In addition, a snapshot of the quorum will be saved once it reaches a
Snapshot Period to ensure that additional MIR staked in the governance contract does not affect the minimum amount of MIR needed to reach quorum. These changes will drive governance participation upwards by reducing risks related to poll creators’ deposits and incentivizing active participation.
A highly requested feature addition by the community was to add MIR to the list of accepted collaterals for mint positions. Including MIR, new collateral types from Terra ecosystem have been added in Mirror v2. All collaterals will be given a new governance-decided parameter called the
multiplier which is multiplied to the
min_collateral_ratio of minted mAsset. Stable assets such as UST or aUST will have
multiplier=1, and volatile collaterals including LUNA, MIR and ANC will be initially set to 1.3333334.
One of the largest issues in Mirror Protocol v1 was the persisting price premium between the Terraswap and Oracle price. To reduce price premiums, a user would have to mint an asset and then sell it against Terraswap pools. However, there was no incentive for a user to short an asset since rewards from providing liquidity with bought assets were higher. In addition, minting an asset was much less capital efficient than simply buying the mAsset from Terraswap, even with the price premiums.
MIR and mAssets pools also exist on Uniswap which runs on Ethereum. Assets from Mirror Protocol can be transferred to Ethereum chain through a custom bridge named Shuttle. Shuttle facilitates cross-chain transfers between Terra and Ethereum, thereby enabling Terra blockchain assets, including MIR, mAsset and UST, to be transferred to and traded on Uniswap.
Assets transferred from Terra to Ethereum will have the same name and ticker, but these tokens will follow the ERC-20 token standard and backed 1:1 in value by its underlying CW-20 assets such as MIR and mAssets on the Terra blockchain. This allows users to trade and provide liquidity for all types of Mirror Protocol assets on both Terraswap (Terra) and Uniswap (Ethereum).
ETH.mirror.finance or mETH is a web interface that supports the staking of LP tokens generated from the liquidity provision of Mirror Protocol assets on Ethereum-side. It resembles the interface of Mirror Web Application but unlike the Terra counterpart, mETH only supports staking and viewing of assets and positions. All trading and liquidity provision transactions for MIR and mAssets can be executed on Uniswap. Similar to Mirror Web App, MIR tokens are distributed to mETH users as staking rewards once per day.