Yield farming and DeFi lending have been part of the decentralized finance ecosystem, and many users leverage in many ways. The goal of everyone who engages in DeFi yield farming is to maximize return on capital. However, the increase in fees has made customers skeptical about the concept of yield farming and DeFi lending.
It becomes a little more complex when users want to lend stablecoins as they have to go through multiple money market protocols. To solve this issue, Growth DeFi has created the first true overcollateralized stablecoin for yield farmers known as MOR.
Overview of the MOR Stablecoin
MOR is a stablecoin deployed on the Binance Smart Chain (BSC), and it is soft pegged to the United States dollar. This is done through several mechanisms and incentives. The stablecoin is designed to stay close to $1 to enable users and customers to leverage up in yield farming and keep interest rates low. MOR can be minted using a fixed exchange rate with other stablecoins. Alternatively, the tokens can be minted by providing collateral in standard tokens and vault tokens using their parameters. All these depend on the risk of the token itself.
The major reason behind the creation of MOR stablecoin by Growth DeFi is to ensure capital efficiency. With MOR, users can leverage up a long position provided the collaterals are supported. It is most useful for yielding collaterals since users can essentially be paid to borrow. MOR is minted by borrowers who are interested in taking a loan with their crypto assets as collateral. There are other businesses that MOR can be used for; an example is leveraging yield farming positions.
The MOR Solution
The creators of the MOR stablecoin designed it to improve DeFi lending and yield farming. It is designed to replace the standard borrowing fee with a stability fee of 5%. The fee percentage can only be changed by voting through the community decentralized autonomous organization (DAO). This makes it easier for users and customers to identify their profit levels early enough and ensure that they receive consistent returns from their activities.
Since the MOR protocol is decentralized, it is more secure and transparent than other centralized alternatives, and the users are completely in control of their own funds. Also, MOR allows users a better understanding of the counterparties involved in a transaction. The implication is that users will be in a better position to always make informed choices. In addition, Growth DeFi allows users to earn yields from their collateral even while they are borrowing it. Aside from giving borrowers more flexibility, it has also provided them with much more safety.
The Features of The MOR Stablecoin
- It is an overcollateralized synthetic stablecoin
- MOR is the first stablecoin with the characteristics to be minted and/or borrowed with tokens already earning yield as collateral. For instance, you can deposit your yield-earning stkBANANA tokens, borrow MOR stablecoin with them, and then use the MOR to get more BANANA tokens, stake them to get stkBANANA. Users can repeat this process until their desired risk level, all done without the need for more capital to acquire the additional stkBANANA.
- MOR is highly impressive for users who want to hold stablecoins. With a 102% minimum collateralization ratio and 50x maximum leverage, users can go in and turn a standard yield of 10% on stablecoins up to over 1,000% APY.
- The only project on BSC that ConsenSys Diligence has audited is WHEAT vaults, and MOR uses these vaults for yield collaterals. (They have also audited Uniswap & AAVE)
Both MOR and WHEAT are built with a revenue structure that supports buybacks and burns of WHEAT and GRO, the ecosystem governance token. To know more about the MOR project, you can join the community on Telegram and Discord.