Mirror protocol is a DeFi protocol powered by smart contracts on the Terra network that enables the creation of synthetic assets called Mirrored Assets, also called mAssets. Mirror ensures that there is always sufficient collateral within the protocol to cover mAssets, and also manages markets for mAssets by listing them on Terraswap against UST.
Mirror is a project developed and steered by its community: its markets are maintained by its users through MIR incentives, and the protocol evolves with new ideas through democratic governance.
The Mirror Protocol is a protocol that allows for the minting of synthetic asset tokens, and before users are allowed to mint a mirrored asset, they must submit a form of collateral to the protocol to equate the mechanics of the over-collateralized debt position that is commonly seen.
While the Mirror Protocol has taken a big step in allowing users to gain price exposure from synthetic assets that have prices tied to a real-world exchange-traded security in a decentralized manner, it was a skeleton proof of concept designed to show that real assets could be traded on the blockchain. The team aims to introduce several features that will introduce new asset types, incentivize active governance, diversify protocol risks, and sufficiently incentivize all user cohorts on the protocol.
TerraSwap and Mirror
Terraswap is a Uniswap-inspired automated market maker (AMM) protocol implemented with smart contracts on the Terra blockchain. Mirror relies on Terraswap to establish UST trading pairs for mAssets and the MIR token. This enables a decentralized on-chain exchange for the various assets involved in the Mirror Protocol.
Terraswap creates automated markets for pairs of tokens (or native Terra coins like UST) called pools, which enable users to exchange one asset for the other directly on-chain. Pools maintain balances of both assets, to which users can provide liquidity in exchange for reward-bearing LP tokens.
Terraswap can execute trades with only the current balances of the pool and the number of incoming tokens. The market price is encoded as the number of a pool’s target tokens divided by the source asset (also called the pool ratio).
The Mirror Token (MIR) serves as Mirror Protocol’s governance token in which only users with a staked MIR position can vote on polls, and each user receives voting power weighted by their amount of staked MIR. For every poll, a user can choose to allocate up to their total staked MIR, and users with a higher MIR stake will therefore have more influence when deciding in governance polls.
The Mirror Token (MIR) is minted by the protocol and distributed as a reward to reinforce behavior that secures the ecosystem. With it, Mirror ensures liquid mAsset markets by rewarding MIR to users who stake LP Tokens obtained through providing liquidity. Also, to incentivize users to ensure mAssets mimic the price behavior of real-world assets, users who stake sLP Tokens obtained through shorting mAssets are rewarded with MIR.
Who are the founders of Mirror Protocol (MIR)?
Mirror Protocol was created and developed by Terraform Labs, a company based in South Korea that also created the Terra network. The CEO and co-founder of Terraform Labs and Mirror Protocol is Do Kwon.
What is Mirror (MIR) used for?
MIR is valuable as it can be staked to receive voting privileges and to earn a share of the protocol’s CDP withdrawal fees.
Governance is the democratized process through which proposals for change in Mirror Protocol are introduced and accepted by the community through voting. New governance proposals in Mirror are called polls, and any user can create a poll by paying an initial deposit of MIR tokens.
Mirror allow for liquidity provision as their LP Tokens are given to liquidity providers when they add liquidity to mAsset-UST or MIR-UST Terraswap pools.
Incentives and Reward
MIR is also used to incentivize users to farm yields by staking LP tokens, which were minted by providing liquidity for MIR and mAssets. The yield is paid to the users from MIRs that are newly minted through annual inflation, and users that stake MIR tokens also earn MIR rewards generated from withdrawing collateral from CDP positions within the protocol.
Mirror allows for trading, hence, a trader engages in buying and selling mAssets against UST through Terraswap and benefits from price exposure via mAssets.
In Mirror, an oracle feeder is a designated Terra account responsible for providing an accurate and up-to-date price feed for a specific mAsset or whitelisted collateral and is the sole party that is permitted to update the registered reported price of the reflected asset.
What is the unique point of Mirror (MIR)?
Mirror’s distinguishing feature is its mAssets.
The mAssets mimic the price behavior of real-world assets and give traders anywhere in the world open access to price exposure without the burdens of owning or transacting real assets.
The minting of mAssets is decentralized and is undertaken by users throughout the network by opening a position and depositing collateral.
How many Mirror Protocol (MIR) coins are in circulation?
Currently, the total supply of MIR tokens is 54.9M. The distribution of these tokens will be made as below:
UNI Airdrop: 16.66% (9.15M) tokens will be airdropped to UNI holders
LUNA staker airdrop: 16.66% (9.15M) tokens will be airdropped to LUNA stakers.
Community Pool: 66.66% (36.6M) of the tokens will be allocated to the community pool.
The total supply of MIR tokens will increase for 4 years due to inflation until the total token supply becomes 370.575M.
How is the Mirror Protocol network secured?
The security of the Mirror protocol is the highest priority, and the development team, alongside third-party auditors and consultants, has invested considerable effort to create a protocol that is safe and dependable. By doing this, all their contract code and balances are publicly verifiable, and security researchers are eligible for a bug bounty for reporting undiscovered vulnerabilities.
The Mirror protocol has gone through professional audits and formal verification and also encourages the community to audit the contracts and security, by disclosing any issues. The Bug Bounty program is intended to recognize the value of independent security researchers and also find and report vulnerabilities.
How do I buy Mirror Protocol (MIR)?
The MIR token can be used for a wide range of uses, like staking.
MIR tokens can be easily purchased by the following steps.
* Open an account with the crypto trading platform.
* Transfer the specific amount of your fiat currency to your account.
* Wait for your deposit to be confirmed and buy MIR through your trading account.
Which Cryptocurrency Wallet Supports Mirror Protocol (MIR)?
The PTPWallet platform supports many cryptocurrencies simultaneously, such as Mirror Protocol (MIR). Because of its vast use case, it has grown to become one of the most used platforms, as it serves as an exchange and an engine to discover other cryptocurrencies. Users can easily use PTPWallet as their MIR wallet because it offers a simple interactive interface, making it easy for people to navigate its system.