As Bitcoin surpasses Ethereum by $8 Billion, another player joins the game.
mStable, a self-proclaimed “meta-stablecoin” company, launched today the mBTC, a cryptocurrency pegged as “Bitcoin stablecoins.”
There is 173,032 Bitcoin on Ethereum, the equivalent to 3.74% of Ethereum’s market cap, or $8.2 billion. And $6 billion of it is just one currency: wBTC, known as Wrapped Bitcoin.
Now another company wanted to have a go in the game of markets. A self-proclaimed “meta-stablecoin” company, mStable, launched mBTC today, a cryptocurrency pegged to the price of stablecoins pegged to the cost of Bitcoin. It is the company’s second stablecoin after the launch of mUSD in May 2020.
Bitcoin stablecoins are also cryptocurrencies, generally based on Ethereum, that are pegged to the price of Bitcoin. Although the value of these stablecoins is just as volatile as Bitcoin, they are worth the same as Bitcoin.
They are minted so that Bitcoiners can invest their wealth in Ethereum’s decentralized finance smart contracts, like lending protocols and non-custodial exchanges.
Anyone that holds wBTC, RenBTC, and sBTC – the three Bitcoin stablecoins based on Ethereum – can mint mBTC. And it is possible to redeem mBTC for any of the three tokens. mBTC will add Binance’s bBTC next month.
What is the point of mStable, a meta-stablecoin? The benefit of mStable comes from its structure; the company stated: its value pegged to a basket of all these Bitcoin stablecoins.
The company claimed in a blog post supporting the launch that if one of the stablecoins collapses, mStable holders won’t lose all of their money, unlike the stablecoins companies where mUSD is based, mStable claims that it is decentralized and non-custodial, which means that users stay in control of their funds.
Furthermore, mStable’s coins earn interest in its app, similar to a bank account. The protocol automatically calculates the interest rate. The site says that there isn’t enough data to determine the interest rate for its sole liquidity pool on SushiSwap, but its mUSD pools generate 50% to 70% per year.
James Simpson created mStable in 2018. The decentralized protocol launched mUSD in May; now, users have minted around $400 million of mUSD.
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