mStable USDPrice

(MUSD)

mUSD is a dollar-pegged stablecoin that operates under two primary models. The "Classic" version functions as a meta-asset backed by a diversified basket of whitelisted stablecoins, such as USDC and USDT. The updated version, launched via the M0 protocol, is a 1:1 dollar-pegged asset backed by high-quality liquid reserves, including cash and short-term U.S. Treasuries. This dual structure provides users with a choice between decentralized basket-based stability and institutional-grade treasury backing.

The protocol uses a basket of underlying assets with strict "max/min weight" limits to manage risk. No single asset can exceed a specific percentage of the total basket (e.g., 50%). This diversification prevents the protocol from being over-exposed to any single stablecoin. If one asset in the basket faces volatility or depegs, the impact on mUSD is minimized, and governance protocols can act to adjust the weight or remove the failing asset entirely.

imUSD is the interest-bearing version of mUSD. When users deposit mUSD into the "SAVE" contract, they receive imUSD, which automatically accrues yield over time. This yield is generated from three main sources: interest earned by lending underlying assets on decentralized protocols, swap fees collected from users exchanging stablecoins within the mStable pools, and interest captured from high-quality liquid assets like U.S. Treasuries in the updated issuance model.

mUSD is designed for high utility both on-chain and in the real world. It is natively integrated with modern crypto debit cards, allowing holders to spend their balances at any merchant that accepts major payment networks. Additionally, the protocol often provides rewards for early adopters and liquidity providers on various networks. Users can check their eligibility for these incentives through official protocol dashboards linked to their integrated wallets.

MTA is the governance token for the mStable ecosystem. Holders can propose and vote on protocol parameters, such as adding new assets to the basket or adjusting fee structures. Beyond governance, MTA serves as a security backstop. If an underlying asset fails, staked MTA (stkMTA) can be auctioned to cover losses and re-collateralize mUSD. This ensures the protocol remains solvent even during extreme market events.

mStable utilizes smart contracts that have undergone multiple audits by leading security firms. Risk is managed through decentralized governance and an insurance fund powered by the MTA token. While the "Classic" version is fully on-chain and decentralized, the updated version involves institutional infrastructure for treasury management. Users should be aware that while this increases capital efficiency, it introduces a blend of decentralized protocol risk and traditional financial management oversight.