2021-04-26 01:46:00

Mirror Protocol Fundamental Analysis– The DeFi Synthetic Assets Platform

  • What is Mirror Protocol?
  • How do you stake in Mirror Protocol (MIR)?
  • What is MIR Coin and should you invest in MIR coin?
  • Which are best wallets for MIR token?
  • From which exchanges you could buy MIR token?

You will get answers to all these and more in this mega guide on Mirror protocol.

A little background…

Recently the crypto industry has gone into a drastic makeshift with the introduction and popularity of DeFi (Decentralized Finance). Sadly, people are just running blindly after DeFi projects without understanding the real value that a project provides to society at large. This is where I come into the picture. I think it is my responsibility to make you aware of the pitfalls and direct you towards this industry’s gems.

DeFi is undoubtedly the fuel that can transform our future completely with its phenomenal design structure and integrated platforms. The main objectives of DeFi can be listed as follows:

  • Decentralization of current financial systems and financial services (such as banking, insurance, stock markets, etc.)
  • Providing access of these financial services to people who are still excluded from these services due to various reasons
  • Cut down the cost of financial services across the globe

Therefore, to incorporate these DeFi services, many projects have been rolled out and are running. One of the best DeFi projects amongst these is the Mirror Protocol.

What is Mirror Protocol?

Mirror Protocol is a Terra based platform to issue synthetic assets, i.e., a synthetic version of real-world assets (physical assets and digital assets). This means that any real-world asset can have a synthetic version on the Mirror Protocol, be it an equity share, commodity, real estate, or any damn thing with any real money value in the world.

But why would you need a synthetic version of an existing asset?

A synthetic asset is listed on a blockchain protocol that makes that asset tradable by anyone from anywhere in the world. A real-world asset is restricted by the laws of the land. However, its synthetic version is not restricted by any such laws or regulations. Thus, making it available to buyers or sellers around the globe. So, we can say that Mirror Protocol checks out the basic objectives of a DeFi platform.

An example of this would be tokenized stocks, like CoinBase. Coinbase is a listed tokenized stock on Mirror protocol, and it could be traded 24*7 on the platform. The best part, it does not matter which part of the world you are in, you can use Mirror protocol to trade Coinbase stocks and other listed stocks.

Mirror Protocol was launched on December 3, 2020, by Terraform Labs (TFL), the group behind Terra blockchain. Initially, Mirror Protocol was only planned for the Terra network, but looking at greater adoption of DeFi platforms on Ethereum and Binance Smart Chain, the protocol was integrated with these networks as well. This helped Mirror Protocol with increased liquidity and increased adoption by the DeFi community.

Now, let us know more about the founders of the platform.

Who are the founders of Mirror Protocol / Terraform Labs?

Terraform Labs (the company behind Mirror Protocol) was established in January 2018 in Seoul, South Korea, by Do Kwon and Daniel Shin. The majority of the Terra team comes from the crypto space and from traditional finance and research. With such a talented team, they first launched the Terra platform and then have developed various utility applications on the platform, which includes Mirror Protocol.

Do Kwon – Twitter

Co-Founder and CEO Terraform Labs

Prior to Terra, Do founded Anyfi, a wireless mesh network startup building one of the most sophisticated decentralized applications in real-world use. Do was a software engineer at Microsoft and Apple and studied Computer Science at Stanford. Do was recognized as one of the Forbes 30 under 30 leaders in 2019.

Currently, Do is serving as the CEO of the company.

Daniel Hyunsung Shin – Twitter

Co-Founder Terraform Labs

Prior to founding Terraform Labs, Daniel founded TicketMonster, which is Korea’s leading e-commerce platform. He is also Co-Founded Fast Track Asia, a company-builder that established and sold multiple businesses, including Fast Five (office sharing platform) and FoodFly (food delivery, acquired by Yogiyo).

Daniel holds a B.Sc. (Economics) degree from the Wharton School, University of Pennsylvania.

Now, as we know the founders and the team behind the platform, let us know about the featured of Mirror Protocol.

What are the features of Mirror Protocol?

Mirror Protocol offers a number of features to its users, which can be classified as follows:

1. mAssets

Mirror Protocol - mAssets

The synthetic assets available on Mirror Protocol are called “mAssets” (Mirrored Assets). mAssets mimic the price behavior of real-world assets (such as Tesla equity share, Netflix equity share, units of United States Oil Fund, and many more).

2. Minting of mAssets

Mirror Protocol - Minting

The process of minting mAsset is decentralized and can be done by any user by opening a position and depositing required collateral. The protocol ensures that there is enough collateral to cover the mAssets. The minimum collateral required to be maintained at all times is 150% of the mAssets issued.

3. Liquidity Pool powered by Terraswap

Terraswap is an Automated Market Maker (AMM) similar to Uniswap, which operates through smart contracts on the Terra platform. Trading pairs for mAssets and MIR token  (more on the MIR token later in this article) is thus established by Terraswap on Mirror Protocol.

When Liquidity Providers provide liquidity mAsset-UST or MIR-UST Terraswap pools, they get LP Tokens in return. There is an LP token for each mAsset-UST’s Terraswap pool, as well as the MIR-UST pool.

Holders of LP tokens receive a portion of rewards generated by the pool’s trading fees, divided out in proportion to the total share of the LP token pool.

4. Decentralized governance through MIR Token

Mirror Protocol - Governance

Mirror Protocol is a decentralized platform that does not have custody of user private keys. Further, it is solely governed by the community where MIR token holders (the native token of Mirror Protocol) helps in the process of governance.

Proposals for any change in the Mirror Protocol are introduced and then accepted/rejected by the Mirror community through voting. Voting right is only given to MIR holders who have staked their MIR tokens on the platform. There are other incentives for staking and participating in MIR governance.

5. MIR token Staking

Mirror Protocol - Staking

LP tokens can be staked on the platform, and in return, the holders of LP tokens would receive rewards in the form of Mirror Token (MIR). These LP tokens can be unstaked at any time.

Further, as already discussed above, the MIR token can also be staked for the purpose of governance.

6. Cross Chain Interoperability

MIR and mAssets are available for trade on 3 blockchains networks as follows:

  • Terra Network
  • Ethereum Network – Uniswap
  • Binance Smart Chain (BSC) Network – SushiSwap

Assets from the Terra network can be transferred to Ethereum or BSC network through Terra Bridge that is supported by shuttle. You can read more on Terra Bridge here.

7. Web User Interface

Mirror Protocol has a very user-friendly web app that can be used to interact with mirror on the Terra network with the help of the Terra Station extension. The web app provides all the features we have discussed above, i.e., minting, staking, liquidity provision, governance, etc.

There is also a web app for the Ethereum network. To read more on trading and staking of MIR and mAssets through the Ethereum network, click here.

8. Mirror Mobile Wallet

Mirror Protocol - Mirror Wallet

Mirror Protocol has an in-house mobile wallet called Mirror Wallet. The application is supported by iOS and the Android devices. It is a non-custodial wallet that does not keep user’s private keys.

The users can trade MIR and other mAssets on the go with Mirror Wallet.

9. Best MIR Token Wallet

Other web-based and mobile wallets supported by Mirror Protocol are as follows:

  • Ledger Wallet (Hardware wallet)
  • Terra Station (Desktop, Web wallet)
  • Metamask (Ethereum / Binance Smart Chain)
  • WalletConnect (Ethereum)
  • Binance Chain Wallet (Binance Smart Chain)

Further, Mirror Protocol also supports Ledger Hardware Wallet.

Watch this video guide to learn how to use Terra station + Ledger wallet for the maximum security:

Now, as we have understood the various features offered by the Mirror Protocol, let us deep dive into the inhouse token of the Mirror Protocol, MIR.

MIR Token – the governance token of the Mirror Protocol

MIR is the native token (Terraswap CW20 Token) of the Mirror Protocol, which also serves as a governance token for the platform. MIR token holders have voting rights for the polls (new governance proposals). However, currently voting right is given to only those token holders who have staked their tokens. Further, the MIR token is also used for the purpose of staking and to reward liquidity providers.

The total supply of MIR tokens is 370.5 million, which will be distributed over a period of 4 years. Currently, the market cap of tokens is USD 522 million with a circulating supply of 56.8 million (15% of total supply).

MIR Token markets: Where to Buy/Sell

MIR token is realtively a new token, but it is now available at all major exchanges. Recently Binance added MIR token to its Innovation zone.

Here are some of the popular markets where you can buy/sell MIR token:

  • 1inchexchange: MIR/USDT, MIR/UST

Using Binance, you should be able to buy MIR token using your debit card or even bank transfer. You can also convert your USDT or BTC to MIR token on Binance.

Conclusion – Mirror Protocol Review

I think that Mirror Protocol is the real gem of the DeFi world which is still an underdog. Thus, I understand that the project and the native toke MIR are overvalued. There is a potential upside to MIR, which will materialize once the platform lists more synthetics and achieves more user adoption.

The idea of brining Tradefi (Traditional finance) most traded assets to this modern finance system for 24* 7 trading, and global access is the USP of Mirror protocol. They are definitely not the first one to do that, as there is another popular platform Synethtix out there. However, the high TPS of Terra network, low gas fees and faster adoption of Terra blockchain, might be the right catalyst that a synthetic platform may need in this hour.

More over, the idea of re-using your stock purchase for extra yield is pretty enticing, and may generate better results than in the traditional finance. I will also be doing a video on Mirror protocol on our YouTube channel. If you don’t want to miss it, you can subscribe to CoinSutra YouTube channel here.

Please note that I am not a financial advisor, and this is not financial advice. DYOR before investing.

I hope this article would provide you a good insight into Mirror Protocol and would help you in deciding your DeFi journey. Let me know the DeFi projects that you would like me to review.

Let me know your feedback in the comments section and share this article with your friends and colleagues. Subscribe to our newsletter for more such articles.

Useful Links:

  • Medium Blog
  • Twitter: Mirror_Protocol
  • Discord: Invitation link
  • Telegram: Mirror protocol
  • Mirror Market finance

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