I'm honestly blown away by all this naming in crypto - it really does sound like some full-scale ponzi, doesn't it? Before you get offended (if you're a fan), I will tell you I'm also vested.
In summary, $MIM is functioning like a stable coin. On the cheaper chains, you can do single-side staking to earn interest, which means no impermanence loss. Sounds wonderful isn't it! I have one question below for the community though.
Before I go on, there's been some articles touching on the tokenomics of MIM, and I, being someone who outsource the research, have some links below for your own reference (advice as usual is to do your own research).
https://www.blocmates.com/blogmates/a-complete-guide-to-wonderland-money-time-mim-and-memo (article)
https://docs.wonderland.money/using-wonderland/mint-your-time/mim-bonds (protocol's docs)
https://coinmarketcap.com/currencies/wonderland/ (overall value for your reference)
On to my question - due to my small capital, gas fees are not very economical for me to be claiming my rewards frequently, as such I have opted for an auto-compounder. And lo and behold, I experienced a 6% capital loss despite the APY. In full disclosure below (well, everyone's a sort of case study I guess), I was tracking my $MIM pool on a daily basis.
Supposedly, I was going to be get:
- Capital USD533 - no loss
- Interest in a week at 57% - USD5.84 (which translate to a 1% gain)
But no, I lost USD30?! For those out there who are completely new, do note that stablecoins do fluctuate in their value as they try to keep their peg (https://www.coingecko.com/en/coins/magic-internet-moneyMy question is - isn't 6% loss a little too much for stablecoin single-side stake? From CoinGecko, below are the all-time-high (ATH) and all-time-low (ATL).
To those who got some interest on $MIM after this article, I would also like to caution you on the risk involved:
- Protocol risk - heard of rug pull? It means the protocol is created to invite investors, and then at an unexpected moment, the creators will withdraw all the funds.
- Smart contract risk - you are interacting with a smart contract when you choose to invest. Any wrong coding or loopholes may be exploited.
- De-peg risk - as you can see from above screenshot, it may deviate from the USD1 peg.
Cheers guys and enjoy your exploration, crypto's all about learning and nothing beats having skin in the game. If someone can advise, thank you in advance!
