WIKI

*Paid Advertisement. Not financial advice. RugDoc is not responsible for the projects showcased here. DYOR and ape safu.

Introduction To Mirror.Finance

Introduction To Mirror.Finance
Table of Contents

Even though synthetic assets aren’t talked about that much in the DeFi space, they play a crucial role in its development. Synthetics assets or “synths” allow cryptocurrency users to trade real world assets without leaving DeFi or needing to open a trading account. Mirror Protocol is one of the first projects that introduced such assets into crypto and that is why we need to have a closer look at it.

What is Mirror Protocol? #

Mirror.Finance is a DeFi protocol that allows cryptocurrency users to invest in real-world assets but also to mint and trade them.These assets are referred to mAssets and they can represent stocks, tokens, derivatives or anything else that can exist in the DeFi world.

To determine which assets can and can not exist on the Mirror protocol we need to look into the key roles that make this whole operation possible.

Traders move capital in, out and around the protocol by executing trades.

A Minter is a user that enters a collateralized debt position (CDP) in order to obtain newly minted mAssets. CDPs can be entered with UST, mAssets or any other form of whitelisted collateral on the Mirror protocol.

Shorters enter the same CDP as minters but with an intention to sell the newly minted asset immediately. This is compensated with sLP tokens that are essentially a receipt for opening a short position on a decentralized protocol.

Stakers use mAssets and sLP or LP tokens to earn passive income paid out in MIR tokens which are the native token of the Mirror protocol.

Oracle feeders are essentially dedicated Terra accounts that provide accurate real-world prices to the protocol and users.

How To Use Mirror Protocol? #

Mirror is deployed on the Terra network so users that want to interact with it will need to have the Terra Station extension installed. Once the wallet is installed it will require some Luna tokens before becoming usable.

Users can either acquire some Luna on centralized exchanges that support direct withdrawals to the Terra network or bridge them from other chains using the Terra Bridge.

Terra bridge

After that, visit the Mirror protocol app and connect your wallet by clicking on the button in the top right corner of your screen.

To buy or sell synthetic assets go to the trading tab and which one you want to buy or sell.

Trade on Mirror protocol

The process is exactly the same as trading tokens on a decentralized exchange like Uniswap.

Borrowing will allow you to take out loans based on your deposited collateral. Depending on the asset you want to borrow, rates and available amounts can vary.

Mirror.finance borrow

For example, mBTC loans will require 200% of loan value to be deposited as collateral while stocks lille mAAPL or mAMZN will only require 150%.

Farming rewards those that have opened CDP positions and provided liquidity to the protocol. The sLP and LP tokens can be deposited in farms and earn rewards in MIR tokens. Reward rates can fluctuate depending on the number of allocated tokens for a specific pool, price ranges and other factors.

Mirror.finance farming

Governance is where MIR token holders can vote on proposals that have been submitted by either the development team or the community. These proposals are voted on and vote value is determined by the number of MIR tokens a wallet holds. Wallets with 1000 MIR tokens will have 10x the impact than those that have 100.

Mirror finance governance

Conclusion #

If you want to invest in stocks but don’t want to sell your crypto holdings to do so, Mirror Protocol may be the perfect solution for you. Synthetic assets and price oracles have enabled the crypto industry to introduce real-world asset trading without the need to interact with brokers or exchanges.

On the other hand, if you want to short a stock but don’t have a way to do that, Mirror will give you an option that is as close to the real thing as it can get, considering that the protocol is decentralized.

As always, it is highly recommended that you read through the docs before interaction with the protocol because synthetic assets can be a bit confusing if you never interacted with them before.

References
Mirror.Finance Docs. (n.d.). Mirror Finance. Retrieved December 22, 2021, from https://docs.mirror.finance/

Updated on December 22, 2021
How do you feel about this article?
 

Leave a Reply

*Paid Advertisement. Not financial advice. RugDoc is not responsible for the projects showcased here. DYOR and ape safu.

Official Partners

BNBchain856
bubblemapsrdbig
Popular Links
Resources
For Farm Owners
RugDoc

Disclaimer: This is done with our best knowledge and effort, nothing can be known for certain – always DYOR and risk management. This is NOT financial advice. Use the information presented here to inform your own decisions. Referral links may be included on any outbound link.

  • What do the risk ratings mean?

Our mission here at RugDoc is to screen for hard rug code that results in 100% theft of ALL underlying funds for ALL participants.

This is the ONE part of the due diligence process that most people cannot simply do on their own as it costs thousands of dollars to hire a senior solidity developer to look over a farm for safety.

A project coin with terrible code can go up in price, and a project with good code and a good team can also go down in price.

Do NOT use our ratings to refer to your likelihood in making money if you invest in the project. They are ONLY in reference to code safety.

Everything else beyond code safety is YOUR responsibility to go do research on. We just make sure the casino you’re betting in won’t rob you before you even get to place a bet.

Our reviews for projects are organized into a few colors.

🟢 Least Risk
These projects are the least likely to hard or soft rug. Usually reserved for cornerstone projects of an ecosystem where it makes no financial sense for them to rug in any manner as they make more money just being legit.

🔵 Low Risk
These projects are usually established projects in an ecosystem that have a track record of success or have KYC’d to us or other authoritative sources in the real world. As a result, it is extremely unlikely for them to soft rug or hard rug their projects. The projects can still fail and the token price can go down, but usually more as a result of natural market forces.

⚪️ Some Risk
This is the default rating for projects with unknown teams but have code that is unlikely to have hard rug risk. Since the team is unknown and doesn’t have a track record of success, it’s entirely possible that they may try to soft rug by dumping tokens, abandoning the project, etc. Even a last minute contract swap to a malicious contract is possible. The only thing that is unlikely is a complete hard rug as long as you are 100% sure you deposit into the contract we review.

🟠 Medium Risk
Similar to Some Risk, but the underlying code itself is custom enough or complex enough that it warrants an elevated risk rating that needs deeper research. Make sure you read every point presented to make sure you’re comfortable with that before entering. Still unlikely to hard rug, but more chances of custom code behaving incorrectly and causing other issues.

🔴 High Risk
Project contains code or practices that are HIGHLY LIKELY to lead to catastrophic losses as they are right now. Make sure you read the description carefully as we will always warn what these issues are. If you see the words Hard Rug anywhere in the review, STAY FAR AWAY!

⚫️ Not Eligible
We reserve the right to not review exceedingly complex projects that would require tens of thousands of dollars of senior security analyst man hours. Typically these are projects that deal with leverage, lending, options, derivatives, and anything that is overly complex and which requires tons of peer reviews and audits from top audit companies.

Search

  • How can I request for an update to my review?

🟢 For owners who have made impactful changes and would like an update to their farm review:

1️⃣ Use #update at @RugDocChat with your description and proof of changes and it will be forwarded to our scanners.

2️⃣ This does not guarantee a change in your review.

3️⃣ Owners who have difficulty solving the issues can consider our Consultation Package - please contact @BaymaxCrypto on Telegram to discuss.