moUSD - The Settlement Currency
Mobius Finance's trading model relies on the idea of offering zero slippage and infinite liquidity (theoretical) to all orders executed within the protocol. In order to achieve this, Mobius Finance introduces the moUSD token as the settlement currency. The moUSD token is the settlement currency proposed by Mobius Finance. It is a synthetic stablecoin asset, pegged to the US dollar (in a similar way DAI intends to be a stablecoin via means of over-collateralization), which can be minted by staking assets as collateral on a smart contract. The total amount of moUSD in circulation is determined by the total value of the tokens staked as collateral (that is, the more assets are collateralized, the more moUSD will be circulating freely in the market).
As the settlement currency of the platform, users who mint moUSD are assigned a share of the overall debt pool (the global debt) of all moAssets minted including moUSD.
Similar to other stablecoins, the most important aspects are to keep its peg and to be able to expand accordingly to supply and demand. moUSD achieves these by offering multiple high-quality collateral assets (currently MOT, MATIC, and DAI are supported, more will be proposed by the users voting on the DAO) to stake against moUSD. By offering multiple collateral options, Mobius Finance offers great flexibility/lowers restrictions to/of the market size moUSD and moAssets.
Each of these assets has been assigned collateral requirements based on the asset type that will impact:
1) Minimum Minting Collateralization Ratio. 2) Liquidation Ratio.
Collateral | Minimum Collateralization Ratio | Liquidation Ratio |
MATIC | 300% | 200% |
MOT | 800% | 400% |
DAI | 200% | 150% |
The four assets for collateralization shown in the table above are open to modification. That is, community consensus and the protocol is stabilized, the collateral requirements for any may be lowered (or increased) in the future to allow for more flexibility and efficiency.
As soon as the value of a collateral token goes below the liquidation ratio, the collateral position is set to be auctioned. Similar to DAI, anyone can liquidate these positions by paying back their debt, which allows them to redeem part of the collateral. Moreover, users are incentivized to arbitrage their moUSD for any other moAsset. For instance, if the price of moUSD fluctuates below its peg on another DeFi market, for example in CurveFi or Quickswap, users can buy moUSD at a lower price, and trade it for any other moAsset on Mobius Finance, resulting in a profit positive arbitrage.
You can acquire moUSD on our Curve pool by following this link:
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