mStable Governance: Meta MTA

What is MTA?

Meta (MTA) is the governance token of the mStable ecosystem. mStable is currently under the process of decentralizing its operations to create a robust community of incentivized and competent governors to guide the platform through its next phase of growth.

MTA has three core functions:

1. To coordinate decentralized governance. 
2. To act as the ultimate source of re-collateralization for the protocol.
3. To incentivize bootstrapping of mAsset liquidity, utility, and a community of governors.

MTA token holders can stake (i.e., deposit in a governance smart contract) their tokens to become protocol governors, allowing them to govern the mStable protocol, where they can decide on the:

• Addition/removal of mAssets
• Addition/removal of bAssets and their max weights
• Redemption and minting fees of mAssets
• Selection of oracles

And in return for performing these functions, governors that stake MTA will earn staking rewards in MTA.

What is mStable?

mStable is a protocol that unites stablecoins, lending, and swapping into one robust standard - making them a stablecoin infrastructure. mStable offers a range of services in which users can:

• Swap: USD stablecoin swaps with zero-slippage. 
• Save: A non-custodial savings account that allows users to have an mUSD savings account. 
• Earn: MTA yield farming program to boost the liquidity of mUSD. Users can stake various Liquidity Provider (LP) tokens to earn MTA. 

mUSD is a stablecoin that is backed by USDT, USDC, sUSD, and TUSD. Users can convert mUSD into imUSD to earn returns. Similar to how yUSD by Yearn Finance and Curve works, imUSD is a pool of yield-bearing USD tokens. The underlying USD tokens are lent on decentralized lending markets such as Compound and AAVE. imUSD holders will have three sources of yield:

1. Lending return 
2. Swap fees
3. MTA yield farming rewards

The returns are claimable in the form of mUSD. If one of the USD tokens is de-pegged from USD, staked MTA will be liquidated to re-collateralize mUSD.

Basically, mUSD is a stablecoin and imUSD is the yield-bearing version of it.

The team is looking into releasing other forms of mAssets. mBTC was released in February 2021, backed by wBTC, renBTC, and sBTC, with imBTC being the yield-bearing version of mBTC.

How is mStable different from other stablecoin pools?

Currently, most pooled stablecoins suffer from a problem known as ‘permanent loss’ of peg. For instance, if one of the stablecoin in the pool goes significantly below the peg of $1, users are incentivized to refill the pool up with that stablecoin completely, redeem anything of value, and ultimately draining all value from the pool – potentially leaving the liquidity provider with naught.

mStable is different in that they have a mechanism that caps risk during its re-collateralization process:

mStable sets maximum weights for each underlying asset. A max weight caps the exposure a liquidity provider has to that asset. When an underlying asset reaches its max weight, it will no longer be minted with or swapped out. 
 
Similarly, users can only redeem the full basket at its current proportions when a max weight is hit. 
 
During a permanent peg loss, users can only fill the basket with a failed asset to a maximum degree and only redeem the basket’s net asset value. Therefore, the risk is capped. 

Why was mStable started?

Standard tokenized assets usually have the issues of concentrated counterparty risk and fragmentation. mStable solves this by uniting and collateralizing multiple assets into one optimized asset per peg. mStable was also created to solve these issues that confront stablecoin users:

• Lack of yield in fiat currencies and stablecoins
• Lack of protection against capital loss in stablecoins

How to obtain MTA?

You can obtain MTA by purchasing them from cryptocurrency exchanges such as Uniswap or Huobi. You can find MTA trading on various centralized and decentralized cryptocurrency exchanges.

Besides that, as mentioned earlier, you can also earn MTA through staking your MTA on mStable.