Title: Whitelisting of USDM algorithmic stablecoin within Moonwell Lending Protocol on the Base chain.
Author(s): TJ & Yair from Meridian Finance
Submission Date: 08/09/2023
Integration of USDM stablecoin for collateral and borrowing on Moonwell Lending Protocol. This addition will provide a native over-collateralized stablecoin option for lenders and borrowers within the Base ecosystem.
Meridian Mint is a decentralized, non-custodial, governance-free borrowing protocol that enables users to obtain interest-free loans against ETH collateral. Loans are paid in USDM, which is a USD-pegged stablecoin. Meridian adopts an over-collateralized lending architecture that maintains a minimum collateral ratio of 110% which is algorithmically validated and assured by a Stability Pool to maintain the pegged value of USDM. As a direct fork of the highly successful Liquity protocol, Meridian shares the exact same smart contract code base. All contracts are fully verified and can be reviewed here on sourcify.
USDM offers lucrative features & advantages, that make it a highly appealing choice for both users and protocols looking to integrate:
- Zero interest rate — Borrowers can hold USDM for as long as they wish. As there is no interest to pay there is no need to worry about constantly accruing debt
- Efficient use of capital — By using a blue-chip asset such as ETH users only need to maintain a minimum collateral ratio of 110% providing more efficient usage of deposited ETH.
- Governance-free — all operations are algorithmic and fully automated, and protocol parameters are set at the time of contract deployment
- Directly redeemable — USDM can be redeemed at face value for the underlying collateral at any time
- Fully decentralized — The Meridian base contracts can be accessed by multiple third parties. This allows for different frontend operators and ensures that the protocol remains resistant to censorship
Full USDM Technical documentation and risk assessment can be found here: https://docs.meridianfinance.net/resources/technical-and-security/usdm-technical-overview
The team behind Meridian, previously ran OmniDex, the largest exchange and lending service on Telos EVM. OmniDex was directly impacted by the failure of the Multichain Bridge collapse, which made the team acutely aware of the hazards of supporting only bridged assets. Our experience at OmniDex motivated us to create USDM—a genuinely decentralized stablecoin that addresses the pitfalls and vulnerabilities of wrapped bridged stablecoins.
We now want to proliferate the adoption of USDM within the Base ecosystem to ensure the network does not become overly reliant on either bridged or centralized stablecoins. We believe as developers in this space we have the ability to guide the industry toward a decentralized future, as it was originally intended. Small decisions made today have the potential to have great effects into the future. Meridian’s robust infrastructure has been rigorously tested and with the support and adoption from other leading Base projects, we believe it can significantly aid the shift towards genuine decentralization on Base.
USDM saw impressive growth in the last month. The image below illustrates the amount of ETH deposited to Meridian in order to mint USDM. Each USDM token is currently 170% collateralized by ETH.
Use the following link to see a live version of the graph:
Add USDM stablecoin as a supported asset (whitelisting) for both lending and borrowing within the Moonwell protocol.
USDM Contract Address: 0x5e06eA564efcB3158a85dBF0B9E017cb003ff56f
Meridian Finance is committed to ensuring the USDM token is always overcollateralized. Thus ensuring its hard price floor of $1 at all times. (This commitment is guaranteed algorithmically via the design of the protocol)
Meridian Finance is dedicated to promoting awareness and adoption of Moonwell within our community, ensuring that the newly introduced pool on Moonwell is actively used.
Meridian supports adopting the WELL token as a treasury asset. 5% of USDM platform fees will be used to purchase the token.
Whitelist USDM for lending and borrowing on Moonwell.
- Moonwell benefits from decentralized stablecoin option
- Meridian Mint holds 5% of treasury assets in WELL token
Nay: Do not whitelist USDM for lending and borrowing on Moonwell.