Description of the Proposal
I propose to list MIR on Mars Protocol.
Background
Mirror protocol is DeFi protocol on terra chain, that enables creation of synthetic assets called Mirror Assets, short mAssets, price of mAsset mimics that one of it’s real world counterpart. Main objective of Mirror Protocol is to allow anyone in world to trade, and bet on price of assets, without requiring KYC, big bank accounts, all while being fully decentralized.
Mirror Token (MIR) is Mirror Protocols governance token, MIR captures value of protocol, it is used for inventivizing positions and providing liqidity.
Basic links
- Project website
- Whitepaper
- Project docs
- Communities: Telegram, Discord, Twitter
Market Risk
Per proposal of Red Bank Asset Listing Risk Framework, here are market risks.
- Maximum intraday drawdown: -30%, 3.6.2022
- Volatility: 6.3%
- 24hr volume: $2M on LP pair, 100M on all markets.
- Worst 7-day volume: $3.7M on LP pair, I couldn’t find one for all markets
The above metrics lead to the following scores:
| Ticker | 1D Worst Drawdown (1y) | Volatility (90d) | Volumes (90d 24hr avg.) | Volumes (Worst week 1yr) |
|---|---|---|---|---|
| MIR | B | B | D or B | D |
Technical Risk
Different parts of the contracts have been audited as follows:
Mirror v2 Smart Contract Audit by Cryptonics
Mirror has Bug Bounty Program, that will pay a reward of $500 to $150,000 for eligible discoveries.
GitHub page where source code is hosted: Mirror Protocol · GitHub
The above metrics lead to the following scores:
| Ticker | Honey Pot | Time since launch | # of SC audits | Quality of SCs |
|---|---|---|---|---|
| MIR | A | B | B | A |
Centralization Risk
Mirror is fully controlled by DAO, recently MIR governance has elected Mirror Steering Committee, but there role is only formal, and they have no control over protocol.
Centralization Risk:
| Ticker | Honey Pot | Time since launch |
|---|---|---|
| MIR | A | B |
Oracle Risk
I propose that we use MIR-UST LP pair from Mirror as basis for oracle, MIR-UST LP pair on mirror protocol has 39.11M, while astroport has 38.93M
Current liquidity: $39.11M
For the specific implementation of the TWAP we propose using the Mars TWAP 1 (same implementation being used on Fields) with the following parameters:
Window: 32 minutes
Tolerance: 2 minutes
Risk Parameters Suggestion
Following the methodology provided in the Red Bank Asset Listing Risk Framework 14 I propose the following risk parameters:
- Loan-to-Value: 70%
- Liquidation Threshold: 80%
- Liquidation Bonus: 15%
- Interest Rate Model: This asset will use a 2-slope (kinked) interest rate implementation with the following parameters:
- Base Rate (interest rate at 0% utilization): 0%
- Slope 1: 10%
- Slope 2: 300%
- Optimal utilization: 50%
- Whether the asset will be usable as collateral: Yes
