Mirror — a DeFi protocol that creates synthetic assets on the network.
Contents:
What is Mirror?
Mirror — a DeFi protocol, running on smart contracts on the Terra network, that allows the creation of synthetic assets, called Mirrored Assets (mAssets). Arrays mimic the price behavior of real assets and provide traders anywhere in the world with open access to price risks.
Mirror is running as a reward for enhancing behavior that protects the ecosystem. With it, Mirror provides liquid markets by rewarding MIRs to users who place bets on LP tokens. In addition, to encourage users to ensure that the sets can mimic the price behavior of real assets, users get MIRs. MIR is valuable as it can be used in betting to gain voting rights and earn a fraction of the CDP removal fee.
How does it work?
The Mirror Protocol allows you to create fungible assets, "synthetics" that track the value of real assets. Mirror synthetics run as key building blocks in smart contracts and for transferring assets to the blockchain.
| To create a mirrored asset (mAsset): | the issuer must block> 150% of the asset's current value in Terra stablecoins or mAssets as collateral. If the value of the asset exceeds the collateral threshold, the collateral is liquidated to ensure that the system is solvent. |
| To target the price of a set: | the system reads the prices of underlying assets through a decentralized price oracle - prices are updated every 30 seconds. When the mAsset price deviates significantly from the primary market, there is an incentive for traders to buy / sell the mint / burn asset to claim collateral. |
| To write a mAsset: | the issuer must record the same number of issued mAssets when the CDP is opened - the collateral comes back to the issuer. |
Mirror — a project, developed and managed by its community. Markets have a support of its own users through MIR incentives, and the protocol is evolving with new ideas through democratic governance.
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