The economy of stablecoins has shrunk since 2023 began due to multiple redemptions. However, brand-new stablecoin asset initiatives have developed, including Aave's GHO, First Digital's FDUSD, and Paypal's PYUSD. On September 1, the Prisma Finance stablecoin protocol went live, allowing users to exchange liquid staking derivative tokens for the MKUSD token. The protocol has locked $55 million in value since its start.
Prisma Finance Stablecoin MKUSD Joins Crypto Economy, $123B Fiat-Pegged
MKUSD, a new stablecoin, has joined the stablecoin economy, which includes many fiat-pegged coins and is now estimated to be worth $123 billion as of September 23. The Prisma Finance decentralized finance (defi) protocol, which went live on September 1, 2023, is the source of the stablecoin. The stablecoin MKUSD issued by Prisma is referred to as a "non-custodial and decentralized Ethereum liquid-staking-token (LST)-backed stablecoin."
In order to borrow MKUSD, Prisma users essentially place supported liquid staking tokens into a vault. The vault may be sold if the collateral ratio falls below 120%. The liquidated debt is assumed by a stability pool, which then distributes collateral to lenders. The collateral kinds that are supported are WSTETH, CBETH, RETH, and SFRXETH. The newly created MKUSD can be exchanged for liquid-staking tokens (LSTs) or utilized on other defi platforms.
Over the past two years, LSTs have gained enormous popularity, and 11.96 million ether is currently locked within LST platforms. The Prisma project set its borrowing cap in stages at the beginning, and by September 15 it had secured $30 million. According to data from defillama.com, Prisma's total value locked (TVL) is currently $55.16 million.
The MKUSD circulating supply is 29.99 million tokens, according to Etherscan. The "Stability Pool" address controls 71.39% of the total supply, yet there are only 129 holders of the token. In essence, a stability pool is a mechanism employed by defi projects to guarantee that a stablecoin's supply is always backed. 14.30% of the MKUSD in circulation are held by Curve Finance, the second-largest MKUSD wallet.
MKUSD is much smaller than the more popular stablecoins like USDT and USDC. FDUSD and PYUSD, two newbies, are also behind it, but it outpaces GHO's supply of 22,706,149. There are roughly 44,376,440 PYUSD and 368,787,867 FDUSD. The top 100 holders in each project control the majority of the supply for all four stablecoins, MKUSD, FDUSD, GHO, and PYUSD.
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