Mirror V2 Testnet Goes Live With New User Incentivization Features

Table of Contents

• New Mirror Protocol Version To Incentivize Governance Participation
• Introducing New Collaterals And Shorting Incentives
• Pre-IPO Assets Can Be Traded On Mirror V2
• Mirror V2 Testnet Parameter Settings
• About Mirror Protocol

The Mirror Protocol V2 has introduced new features that would boost the existing ones from V1. The developments were implemented to incentivize users for their given contributions within the protocol.

New Mirror Protocol Version To Incentivize Governance Participation

In the Mirror Protocol V1, users did not feel sufficiently incentivized to participate in the governance, which is a vital part of the Mirror Protocol decision-making. Their staked MIR tokens had to stay locked until the end of the poll. Additionally, they needed to make MIR deposits to create new polls. As a result, poll creators who could not afford to make further MIR deposits would lose out on their staked MIR due to a lack of poll participation. 

However, in Mirror Protocol V2, active voters can get additional voting rewards in addition to existing staking rewards. In addition, an ABSTAIN vote option is also added for users who want to participate actively in governance but feel that they do not adequately understand the proposal. These implementations will reduce the risk of losing deposits and incentivize active participation, thus driving governance. 

Introducing New Collaterals And Shorting Incentives

The high price premium between Terraswap and Oracle was a problem for the Mirror V1 users. They would have to mint an asset and sell it against Terrasawp pools, to reduce price premiums. The lack of incentive for shorting and the high capital costs of minting assets were the major pain points of the Mirror Protocol V1. 

However, in V2, MIR has also been added to the list of accepted collaterals for mint positions. Additionally, other new collateral types (LUNA, ANC, aUST) from the Terra ecosystem have been incorporated in Mirror V2. Additionally, the non-tradeable sLP tokens are minted from creating a short position. They are also stackable and generate rewards based on the current price premium between Terraswap and Oracle price. 

Pre-IPO Assets Can Be Traded On Mirror V2

Assets scheduled to undergo an IPO can be whitelisted and traded on Mirror V2. Users can specify the specific details of the asset by leveraging the Mirror governance pool via poll creation. If the poll passes, these assets will be minted (during a predetermined timeframe) or traded like any other mAssets pre-IPO. Once the IPO starts, Mirror Oracle will begin reporting prices from the market, and the asset will have the same features as any other mAsset.

Mirror V2 Testnet Parameter Settings

Mirror Protocol took to their official Twitter handle to highlight the V2 parameters - 

“Voter weight: 50% of protocol fees from CDP closures distributed to stakers who vote on ongoing polls

Proposal Deposit: 1 MIR (amt to list a proposal)

Quorum: 5% (of staked MIR voted to validate poll)

Protocol fee rate: 1% (fee applied to value of asset being burnt)

UST lock-up after shorting: 600 seconds

Voting period: 318 seconds

Quorum snapshot period: 100 seconds

Effective delay: 331 seconds (time before change goes into effect)

Price premium update interval: 600 seconds”

About Mirror Protocol

Mirror is a DeFi protocol powered by smart contracts on the Terra network that enables the creation of synthetic assets called Mirrored Assets (mAssets), which mimic the price behavior of real-world assets and give traders anywhere in the world open access to price exposure without the burdens of owning or transacting real assets.