MIR-UST strategy bug

Dear team,

I have decided to farm using Mir-UST strategy. Decided to start by testing with 604 mirror token and around 500 ust.

About a week later, when I click on the manage button its showing me that I have supplied only 574 mirror - this is wrong and I verified that I supplied 604 MIR using terra finder.

Also, when I close my position, where will farming rewards be?


Hello ser! (I’m not a team member but)

Do you remember what the price of MIR was at the time you started, and how much UST is it showing when you try closing your position?
When you check you PnL is it positive or negative?
Since you supplied to an LP you might have experienced some IL over the week with the price-volatility while the value of your position has still increased, or you could have been paying more interest on your borrowed UST than the position has been earning over the week.
Your PnL will show you the value of your entire position, Minus interest on borrowed UST and impermanent loss.
Farming rewards are automatically compounded into your LP!

Pnl is positive. Supplied mir token at $1.6 currently MIR is is $1.8. Doubt this is due to IL. Also if gains are auto compounded, how come I have 30 less mirror than when I started? Never experienced this when providing liquidity, something is wrong here. Can anyone shed light on this issue?

Since you supplied to the LP with leverage, you have been borrowing UST to your MIR LP which accumulates interest and your LP is also rebalanced in this strategy, if your PnL is positive then you are you getting your withdrawal in 50/50 MIR-UST or are you still getting 500UST?
If it seems off, you can always head to the Mars Protocol and open up a ticket if you want a team member to look at it for you

Beginning to think mars farming is one big scam. So far, i have made an estimated $68 in profit - but that’s because the token has risen in value. Where are my rewards apart from capital gains? Whenever I ask this question, I’m always told “they’re reinvested”, however when coming to close position, I have not seen my “reinvested” rewards. Explanations surrounding the protocol mechanics are suspiciously quite ambiguous. I have opened a ticket on discord, and have since not had any replies. I mean all the alarm bells are ringing here…

OP: Based upon the information you gave, it seems to me that the protocol is behaving quite correctly.

You deposited 604 MIR at a price of 1.6 and borrowed an equal amount of UST to finance the other half. The total value of that position at the start is 604*$1.6*2= $1932.8, of which your cost basis is half, or $966.4

MIR price went from $1.6 to $1.8, so the MIR-UST LP token’s price change due to MIR price change is sqrt(1.8/1.6), and the total value of the position at the end is $1932.8*sqrt(1.8/1.6)=$2050.04. This is after IL.

Half of that position is MIR, so the number of MIR tokens you have in the position is 2050.04/1.8/2 = 569 ~ 574, which is accurate to the two decimal places you gave for the prices and the difference between my estimate and your report is ~5 MIR in your favor.

I estimate your profit-loss would be 2050.04/2-966.4 = $58.62. The difference between my estimate and what you say MARS protocol reports is the same ~5 MIR in your favor.

Actually there may something wrong with my math. I failed to notice you put up 500 UST in addition to the MIR. But still, shouldn’t the net profit-loss be 2050.04 (final position worth) - 966.4(borrowed UST + UST cost basis) - 966.4(cost basis in MIR) = $117.24? in other words, ~2x what is currently reported by the site?

I think this difference is actually somewhat concerning, because on what basis is MARS protocol taking half the profit? Does that mean also that MARS would be taking half the loss if MIR price were to decrease?

He wasn’t using 2x leverage though as he put in UST as well, 2x is max leverage on a strategy where you only deposit the primary asset with no UST…
Also I believe the “Loss” of MIR tokens is due to the fact that MIR went below the initial value it was when he deposited and then increased up to 1.8ish really quick… I personally got in MIR-UST pool on Astroport the same day as him and on the day this was posted when i checked my pool tokens I also had less MIR tokens but with a higher value of the LP position.
During those rapid spikes in price is usually when you experience IL if you try to withdraw your tokens as the pool is rebalancing and if you’ve only been LPing for a few days- a week you haven’t really received much in neither token incentives nor swap fees. Also the fact that the position was using leverage means that during those days that the MIR price was down that position was loosing more than any standard LP position would as you’re also paying interest on your borrowed UST.
So the fact that the PnL was + prob shows that it’s normal and that it wasn’t Mars taking half the profit since the profit he received was in the UST of the leveraged position - Like i said you get IL if you withdraw during or right after a huge spike in price normally and even more so with leverage… if you try to exit an LP position right after a 15% daily price increase, when price has been trending below your initial deposit for more than half the time, then you exit at a point where a lot of your MIR will have been “sold off” to balance your LP. Basically as during most of the week your LP has gained more MIR tokens but because the price of MIR was down = less UST in the LP and only a small loss in the LP value - then a quick spike up in price means a lot of MIR has to be sold of to add UST to the LP = LP gains in value - you “lost MIR” due to the fact that you needed a lot of UST added to the LP for it to be 50/50.