Recapitulation of Mercurity Finance AMA event held at AMA LOVERS CLUB
Venue: https://t.me/amaloversclub
Date: Monday, 2nd November, 2020
Time: 14:00 UTC
The Mercurity Finance team was represented by @ErezSimha and @LDA_Michael. They both judiciously shared with us detailed knowledge and information about the project.
1st Segment: INTRODUCTION
Q1 : Can you please introduce yourself and your background, also if you have a team, you can introduce them. Also give a brief introduction of Mercurity Finance.
Ans : Hi every one and thank you for joining us today. I am Erez , CFO and interim president of Mercurity.
Shortly about me: I have spent last 15 years in high tech companies , public and private , small and large - all of them operates in hyper growth environment - my main tasks prepare those companies to meet 3-5 market demand and challenges so putting in place the right infrastructure that will allow scalable profitable groewth
Let’s talk a little bit about mercurity and mercurity .Finance. Mercurity is a public company traded in Nasdaq under the ticker MFH , and have business directly related to blockchain technology
Mercurity.Finance is an open DeFi platform , part of Mercurity. It is Open Defi platform powered by swap. The most important problems we aim to solve are:
Low capital utilization, impermanent loss risk, and poor community governance capabilities. We’re starting with DeFi, aiming to provide the most open, flexible, autonomous, and comprehensive DeFi trading and liquidity services to retail consumers anywhere, anytime. But that’s just the beginning of our story
Essentially, we are providing the infrastructure for users to utilize features that are currently unexplored in the DeFi arena. We want to unlock and accelerate access to new financial value for anyone, anywhere and empower new financial values through unique implementations on Swaps, Lending, Impermanent Loss Insurance, Synthetics, and much more. WE aim to build the most global, unified, and diverse DeFi ecosystem by connecting the world’s best DEXs and DeFi communities across the globe. We are building global solution.
Q2 : Firstly, can you tell us a bit about the origins of Mercurity? How did the idea come about?
What makes you different from other DeFi Protocols?
Who would be able to create the GP pools?
Ans : We’ve noticed that today’s DEX liquidity pool communities have achieved over $10 billion in TVL but, despite the many advancements in DeFi protocols, these communities still lack the necessary autonomous governance to fully take advantage of their potential value
In Addition, today’s DeFi platforms still suffer from low capital utilization and liquidity, costly impermanent loss, and token incentive deficiencies
For example, many DEXs distribute transaction fees based solely on liquidity providers’ actual contributions. This approach leaves some important ecosystem participants out in the cold - liquidity pool creators, early stage liquidity contributors, and non-financing community members, such as community managers, marketers, and other industry influencers We believe that these community members also share important functions that help raise the TVL tide that lifts all DEX boats and that they, too, should receive incentives for their efforts.
As importantly, many DeFi pool communities still lack the necessary autonomous governance to take full advantage of their potential value.A more open, flexible, autonomous, and comprehensive platform is needed to continue to evolve DeFi in the right direction and maximize its full potential.With these principles in mind, the Mercurity.Finance project aims to build and expand on these values to unlock and accelerate unprecedented value by exchanging diverse assets with each other anytime, anywhere across the globe.
And about what makes Mercurity.finance different from other Defi Protocols : We aim to empower liquidity pools with a multi-level structure for autonomous governance options and growth incentives. For example, each liquidity pool has their own General Partner (GP) and governance capabilities such as setting transaction fees, pool access requirements, trading rules, and voting rights.
Another big innovation is the Pair Token, an incentive token for liquidity providers that enables governance of the individual liquidity pools as well.
The biggest highlight here is :We are trying to build a full ecosystem rather than addressing one user case. We provide access to lending, insurance and many more to everyone everywhere.
For the GP pools :Everyone is able to create, manage, and market their own pools and include other partners to join in while setting up their own “rules” of the pool. Through our swap feature, each pool is like an independent fund, similar to how ETFs are managed.You will have full control on who will join, how much it cost, distribution
Q3 : What is unique about your lending feature?
Impermanent loss has been a hot topic in the DeFi industry. How will Mercurity’s Insurance feature help users?
Ans : Our lending feature allows users to stake their LP tokens to earn interest and lending pool governance tokens. Our Protocol is a fully decentralized, money market protocol for staking LP tokens to lending trading pair assets
The protocol is designed to improve the LP’s capital utilization and allow lending users to obtain liquidity benefits from impermanent losses.
Our Impermanent Loss Insurance feature allows users to stake their LP tokens to earn premiums, and insurance pool governance tokens. Users can pay premiums with their LP tokens to lower (not eliminate) Impermanent losses through an autonomous governance system. Users who own the Insurance pool governance token are able to vote on different issues and be able to participate in the feature’s functionality.
Mercurity provides 2 different mechanism to avoid impermanent loss.,LPs on Mercurity Finance can purchase impermanent loss insurance, and they can act as liquidity lenders to enjoy the benefits of liquidity without bearing impermanent losses. This is unique feature , part of a full echo-system we are building.
Q4 : Can you tell us your future plans for Mercurity?
Ans : Sure! We will be launching LP token staking, liquidity farming, swaps, and rewards rules in the next several weeks. We know this is a big vision but through technical innovations, we will be live shortly for users to unlock the next tier of Decentralized Finance, and we invite you all to join this amazing journey with us .
2nd Segment: TWITTER QUESTIONS
Q1 : Concerning Trade Mining, do you think rewarding traders with MER token based on their trading activity is the best decision? Don’t you think whales could take advantage of this opportunity to continue to dump the token regardless of the price just to be entitled to this reward?
Ans : it is great question . We have built a mechanism that will motivate whale and others to stay for longer period , and demotivate them from leaving early.
Q2 : It’s very interesting project but What does it mean that the fund utilization rate of Defi projects is far lower than that of banks?
Ans : The Fund utilization rate measures the percentage of liquidity pool contributions that are utilized to earn a return. If TVL for a liquidity pool is $200mm, and $150mm in pair tokens have been staked to leand, then fund utilization = 75% (=$150MM/$200MM)
For example, when a bank absorbs 10 billion USD in deposits and provides 7 billion USD in loans, the fund utilization rate is 70%. The bank needs to pay interest on deposit for 10 billion, which is the bank’s cost, and the benefit is from the interest on 7 billion loan.
In order to earn returns, funds must be utilized. On Uniswap, transaction fees are generated only when liquidity pool funds are traded. If, on a given day, trading volume is 10% of TVL, then 90% of the funds were not “utilized” and therefore did not contribute to earnings.
Mercurity Finance provides multiple opportunities to increase and better utilize funds via LP Pair tokens. LPs are issued Pair Tokens equal to the liquidity provided. These tokens represent liquidity that is locked (i.e., secured) which can therefore be utilized to earn via:
Pledged for loans (earn interest income) or insurance (earn premiums)
Q3 : Your mission is to build a global, unified, & diverse DeFi ecosystem by connecting the world’s best DEXs, CEXs, and DeFi communities across the globe. How do you aim to achieve this? What are some of the products you plan building to help make it possible?
Ans : The Mercurity.finance platform consists of a matrix of sub-protocols that collaborate effectively to create unique value.in a very high level this is a cross protocol to empower each other , AMM protocol, impermanent loss insurance , LP lend , and synthetic assets - those are used as core components to empower other protocols .LP token could be "reused" across protocols , through a formed global distributed community created with the support of Mercurity .
3rd Segment: LIVE questions
Q1 : When exactly will the Mercurity Swap and Mercurity Lend Protocol be available and what privileges will users enjoy, especially with Mercurity Lend?
MercurityFinance How does it ensure that each sub-protocol is independent from the others, easily integrated, and is compatible with other protocols?
Ans : The Swap protocol to enable GPs will be enabled shortly to allow users to create ETF like pools (independent funds) with autonomous governance through the pair token (liquidity pool governance tokens) to allow owners to be able to vote on pool adjustments like transaction fees and much more.
Q2 : All platform that use a SWAP mechanism, must affront 2 issues, the low Liquidity ( that cause Big spreads between orders) and Slippages, so can you tell me how Mercurity will solve this instrinsic limitations?
Ans : Mercurity.Finance will utilize a on-chain smart order routing engine which will be able to pull the best prices from not 1 but ALL of the independent pools on the protocol to route the best optimal position for conversions.
We understand the importance of building community, especially in DeFi. To build awareness and the community we are going to be involved with over 8+ community AMAs, and work alongside different press, and DeFi content creators to educate the Defi community about Mercurity.Finance
Q3 : How does Mercurity Finance team sees Defi potential for long-term run?
And what is the feature That Mercurity Finance will provide for the DeFi space in long run?
Ans : Decentralized Finance is still in it’s early stages compared to the rest of the crypto market. Think of it as the basic foundation of money legos built on the blockchain. First you had the basics like swapping, lending, borrowing, and utilizing synthetics for off market items. After the basic building blocks are created, it’s now time to build on top of that to incorporate more complex features that enable more utilization similar to the traditional finance world.
Q4 : Could you please differentiate between MEE and MER token? Are both of them governance token of Mecurity platform and When are they expected to be available?
Ans : MER will be Mercurity's governance token which will be used to govern the entire protocol (swap, lend, synthetics, & insurance) while MEE will be utilized just for the swap platform.
MEE will be available shortly for users. Stay tuned on our announcements channel for more updates: https://t.me/MercurityAnnouncements
Q5 : Mercurity Reuse LP tokens across different protocols to maximize yield. How it possible to use different protocols on Mercurity? What technology do you use to make this happened?
Ans : When a user created a pool, they have the option to create pair tokens with it to provide pool governance, these tokens can be utilized in the lending protocol, insurance protocol and synthetics protocol to utilize their value.
Other protocols can interact and include themselves in the pools and create structures where funds can be utilized from different platforms in order to "bundle" into the ETFs.
CONCLUSION
Thank you to the AMA Lovers club team for inviting us here today, and thank you to the community for all of your excellent questions and engagement.
It’s been a pleasure to connect with you all!
Be sure to follow us on our socials to keep up to date with our progress. Lots coming to look forward to!
Telegram global community: https://t.me/mercurityfinance
Telegram announcement channel: https://t.me/MercurityAnnouncements
Twitter: https://twitter.com/MercurityDeFi
Medium: https://medium.com/mercurityfinance
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