DeFi For The Next Billion: Maiar Exchange

To Enable Internet-Scale Value Swaps, Global Accessibility, And Fair Community Distribution

To Enable Internet-Scale Value Swaps, Global Accessibility, And Fair Community Distribution

Tokenization enables global and immediate liquidity for virtually any type of asset. Through automatic appraisal, collateralization, and programmatic trading mechanisms, decentralized finance is about to blur the lines between what today we consider as differentiated markets.

The ability of any kind of value to become digital, liquid, instantly, and globally tradeable will give the world economy superpowers. Literally.

It is therefore immediately obvious that the underlying infrastructure powering value exchange becomes critical infrastructure for the 21st century.

The rapid evolution from stock markets, to centralized exchanges, to decentralized exchanges, powered by automated market makers, paves the way for a significant global improvement. For this improvement to materialize and become widely adopted, a few essential elements are necessary:

  • A powerful automated market maker – enabling an efficient programmatic peer to peer exchange between buyers and sellers
  • An internet-scale and open infrastructure – enabling swift and inexpensive transactions at a global scale
  • Intuitive user experience – enabling anyone to become an actor in the global economy
  • Global and democratic community incentives, distribution, and governance

So where are we now?

Automated Market Makers built on Internet-scale infrastructure
The essence of current versions of automated market makers is best expressed through the constant product equation:

x * y = k

Based on it, if a swap pool owns some units of token and some units of token y, it prices trades so that the quantities of x and y resulting after the trade, when multiplied, are equal to a fixed constant, k.

But current AMM performance could be significantly improved by rebuilding them on vastly more scalable architectures.

By reimagining an automated market maker on top of a highly scalable architecture that is high bandwidth, low latency, and inexpensive, the performance of the swap processes can be drastically improved. With significantly better performance, the scope of AMMs can be rapidly expanded, giving birth to new market opportunities.

Perhaps the most important growth vector we will see will come when intuitive simplicity and ease of use will enable tens of millions, hundreds of millions, and eventually billions of people to interact with these new technologies, facilitating simple and instant exchange, at scale.

Community distribution, incentives, and collaboration
Going beyond the product performance and UX: community distribution, incentives, and governance create the premise for an engaging bootstrapping process, incentivizing both immediate adoption and long-term contribution.

Putting each of these puzzle pieces together will create a compelling product, fueled by a rapid growth trajectory, taking it beyond the blockchain ecosystem.

Introducing the Maiar Exchange – internet-scale value swap for the next billion
The Maiar Exchange is the ultimate automated market maker, rearchitecting some of the key elements to build a product that can leverage the entire performance of the Elrond architecture, to offer global, near-instant, inexpensive transactions between an expanding suite of assets.

Furthermore, once live, the Maiar Exchange will be integrated into the Maiar app, offering a simple and intuitive interface that is accessible to anyone anywhere in the world.

To ensure rapid adoption cycles, open governance, and long-term contribution, the Maiar exchange will have a native governance token called MEX, enabling community-driven development and governance.

The token will be essential for the sustainable development of the Maiar Exchange and its governance. The governance process itself will kick off around 3-6 months after the platform’s launch, allowing sufficient time for MEX to reach a large number of holders.

Pioneering a fair and wide token distribution
The Maiar Exchange will feature the very first token of the Elrond ecosystem, with a fair launch, 100% distributed and owned by the community. The distribution of the MEX token will be made in a fully transparent manner, towards the community only, without any pre-allocations for team, advisors, investors, etc.

The token distribution will be as follows:
There will be a total of 1 Billion MEX tokens, of which:

  • 47,50% of the token supply will be claimable by EGLD holders in the first year
  • 44,95% of the token supply will be earned by liquidity providers during the next 10 years, with 5 halvings every 2 years
  • 2,55% of the token supply will be distributed to members of select DeFi communities (50% UNI, 25% SUSHI, 25% CAKE)
  • 5,0% tokens will be put in a security fund, serving as proactive insurance against critical bugs or security hacks

Snapshot conversion ratio will be non-linear, specifically, MEX will be claimable pro-rata based on the following formula:

  • MEX amount = (my EGLD amount ^ 0.95) * EGLD ratio
  • MEX amount = (my UNI amount ^ 0.8) * UNI ratio
  • MEX amount = (my SUSHI amount ^ 0.8) * SUSHI ratio
  • MEX amount = (my CAKE amount ^ 0.8) * CAKE ratio
  • EGLD ratio = calculated after snapshot
  • UNI ratio = calculated after snapshot
  • SUSHI ratio = calculated after snapshot
  • CAKE ratio = calculated after snapshot

These conversion rates are chosen in order to reduce wealth concentration onto large holders of EGLD and UNI / Sushi / Pancake and redistribute more evenly onto smaller holders.

Community distribution mechanism

  • EGLD holders (available balance): weekly distribution based on daily random snapshots for 1 year – 1x multiplier
  • EGLD holders (available balance) using Maiar AND with at least 1 EGLD AND with at least 5 Maiar referrals: weekly distribution based on daily random snapshots for 1 year – 1.25x multiplier
  • EGLD stakers (staked or delegated balance): weekly distribution based on daily random snapshots for 1 year – 1.5x multiplier
  • One time UNI / Sushi / Pancake snapshot (TBA)

Note: For EGLD holders/stakers only one multiplier can be applied per address (the most favorable one)

The snapshot calculation = weekly average based on daily random snapshots. All snapshot balances will be claimable by the accounts for a period of 1 month after the snapshot. Unclaimed MEX will be burned.

NOT eligible for MEX distribution:

  • Foundation-Token
  • Vested (locked) tokens
  • Tokens held on exchanges
  • Unclaimed staking rewards
  • Old ERD tokens

Liquidity Providers earnings
The liquidity vesting schedule is algorithmically specified as follows: starting from 232M tokens for the first two years, with the number of tokens distributed halving every two years.

The liquidity mining program begins with the launch of the Maiar Exchange and will cover the following pools:

  • EGLD/MEX
  • EGLD/BUSD
  • MEX/BUSD
  • Staking pool for EGLD LP providers
  • Staking pool for MEX LP providers

The MEX will be allocated per pool proportional to liquidity as calculated by the total EGLD value in the pool. In non-EGLD pools, the proportional liquidity is calculated by quoting the price of the base token in comparison to EGLD.

The Fee distribution will be as follows:

  • 0.2% will go to liquidity providers for the given liquidity pools
  • 0.05% will go to MEX liquidity providers who stake their LP tokens
  • 0.05% will go to eGLD liquidity providers who stake their LP tokens

Important note: all above calculations are approximations, and could be subject to change, updates, or rebalancing during the next few weeks.

Time frames, snapshots and reinforced hypergrowth
The first snapshot for EGLD will begin on Monday, the 19th of April, with 52 weekly averages of 7 daily random snapshots to follow, spanning one year. The snapshots for the first 4 weeks will each have 5x, 4x, 3x and 2x weight compared to all the other weekly snapshots, kickstarting a rapid and momentous bootstrapping cycle.

The major launch of the Maiar exchange is targeted to go live as a web version on the 30th of April, pending a successful mainnet upgrade and the completion of final security audits. Eventually, the Maiar exchange will be integrated into the Maiar app for a more seamless user experience.

With the Maiar Exchange going live, a new economic engine is set in motion expanding the Elrond ecosystem. How large can this exchange become?

The Maiar exchange is tackling a hard trillion-dollar problem of global significance. Its ability to easily onboard hundreds of millions of users will rapidly grow it into one of the largest decentralized exchanges in the entire ecosystem.

Onboarding the next billion people will take resourcefulness, hardcore effort, and collaborative community contributions.

The Elrond ecosystem and community have grown tremendously during the last period, and with each of the DeFi 2.0 components, this growth will further accelerate significantly.

Elrond is live. Maiar is live. Staking is live. And the Maiar exchange is here.
Time to get your eGold ready. The snapshots are coming.

And with them, a new growth phase begins.

The original version of the article can be found at elrond.com