Summary:
This proposal aims to add RAI as new collateral on Mimo on Ethereum.
Rationale :
RAI aims to be a non-pegged and decentralized stable asset with low volatility, and only backed by ETH. RAI is based on a system that reacts dynamically to market conditions with respect to two essential parameters 1) Redemption Price, 2) Market Price.
The system has no control over the RAI price observed in the market, which is determined by buyers and sellers. Nevertheless, it can gradually adjust certain parameters to modify the redemption price and converge the two prices in the future.
In addition, the Protocol is intended to be “governance-minimized”, the vision is to automate everything that can be automated in the future like decisions that are usually taken by governance are automated in Reflexer by the PID controller.
You can learn more about these mechanisms in their documentation / whitepaper and with this series of 3 simulation articles (1), (2) & (3).
Once the vote is accepted on Snapshot, we will determine the associated liquidation ratio, minimal collateral ratio, debt ceiling, liquidation bonus on a second MIR discussion.
With its own properties and mechanisms, the addition of RAI as collateral on Mimo would increase the decentralization of the PAR and offer an alternative to USDC.
Project Presentation:
Protocol name : Reflexer
Token requested : RAI
Token contract address : $2.92 | Rai Reflex Index (RAI) Token Tracker | Etherscan
Audit(s) links : GitHub - reflexer-labs/geb-audits: List of audits for the whole suite of GEB related smart contracts
Chain requested : Ethereum
Relation with the project : None.
Website: https://reflexer.finance/
Twitter : https://twitter.com/reflexerfinance
Discord : discord.gg/AXwXHGsTaJ
Token metrics & Risk assessment:
- Smart Contract risk: C+
The Reflexer protocol and its stable asset RAI are permissionless, and aims to be “governance-minimized” in the future. The way RAI are minted/burned works around a “Safe”. In order to mint RAI, you must open a Safe. RAI will be burned by the repayment of the debt. RAI has generated more than 111k transactions.
- Counterparty risk: C+
The process to mint RAI is permissionless and aims to be “governance-minimized” in the future, which makes it one of the most secure and decentralized stable asset. There are currently 3013 holders on Ethereum.
- Market Risk: C+
RAI on Ethereum has a $14,7M market cap. Furthermore the price isn’t correlated by another stable asset but the stability is provided by the Reflexer mechanism. For this reason we consider the risks of RAI mitigated by his only over-collateralized asset: ETH, which is one of the highest market cap and trading volume of ERC-20 token.
- Chain Risk : A
Ethereum had 0 outages over the last 6 months. (Ethereum Block Count and Rewards Chart | Etherscan)
- Liquidity Risk of PAR on Ethereum: A
The PAR-USDC UniV3 pool has 1,7M$ in concentred liquidity, composed of 20% PAR and 80% USDC at the time of writing. The PAR-USDC Curve pool has 430k$ in liquidity, composed of 52,1% PAR and 47,9% USDC at the time of writing. The MIMO-PAR Balancer pool has 260k$ in liquidity, composed of 80% MIMO and 20% PAR.
This provides the following price impact on the following trade sizes:
1000 USDC → PAR: 0.02%
10000 USDC → PAR: 0.04%
25000 USDC → PAR: 0.08%
50000 USDC → PAR: 0.16%
- Overall Risk : B
The Overall Risk is the average of the points mentioned above.
- Community size :
Twitter: 19k followers
Discord: 3219 members
Technical implementation:
- Add RAI in the ConfigProvider Contract with all parameters decided by the Mimo governance.
- Set the chainlink oracle related to the RAI: RAI/USD into PriceFeed Contract
Voting options:
- Add RAI as new collateral on Mimo on Ethereum
- Against adding RAI as new collateral on Mimo on Ethereum
- Abstain
Authors: @starny & @JeanBrasse from Mimo Labs
Community poll:
- Add RAI as new collateral on Mimo on Ethereum
- Against adding RAI as new collateral on Mimo on Ethereum
- Abstain
0 voters