In this post, we’re excited to share information about the soft launch of the ZAI Stablecoin. After nearly 3-4 years of building in the DeFi space and understanding a lot about stablecoins and the ecosystem, we are excited to share that the ZAI Stablecoin is now our final iteration of a stablecoin.
As a project and a community, we have conducted many experiments. We have built ARTH as first a completely elastic stablecoin, then a partially elastic stablecoin, and finally a fully over-collateralized stablecoin. After all this experience and exposure we decided to go simple with ZAI and try to keep things very minimal.
ZAI’s current model is fully collateralized with two kinds of collaterals. The first is stablecoins, and the second is over-collateralized loans (for stability). We document the entire design of the stablecoin here: Peg Mechanics | MAHA
We are also excited to share that the current model is audited by Halborn, a reputable audit firm and our partner with ZeroLend.
Phase 0
As part of the Phase 0 launch, we have documented in our roadmap that we focus on finding product market fit for the ZAI stablecoin and soft-launch the protocol on the mainnet.
Due to the rough market conditions (as of this writing), our focus should be on getting users and building a working stablecoin that borrowers will want to borrow.
This is why we’ll be putting caps in the protocol and increase them as demand grows. Whenever the caps get hit we will keep increasing caps at roughly 10x at each level.
- Level 1: Minting caps are set at $1mn
- Level 2: Minting caps are set at $10mn
- Level 3: Minting caps are set at $100mn, and so on
In the initial stage, we will be setting the minting cap to $1mn and the borrow limit to $100k. This is sufficiently large enough to test the protocol but also small enough to do anything meaningful.
While we are in this stage, we will not run any MAHA incentives as would like users to use the stablecoin and the product for what utility it offers. Growing without incentives is crucial for the project to find a proper product fit, as with incentives, we won’t really understand if the protocol is sustainable in the long run or not.
Growth and Go-to-Market Strategy
In the first week, we will focus on our internal community for feedback on the protocol and then start working on a few leverage strategies by providing liquidity to lending markets. The team will initially seed the protocol with over $100k of liquidity to allow users to leverage on various markets.
With this initial seed liquidity, we plan to support the borrowing of ZAI (USDz) against Pendle’s PT tokens.
The focus on Pendle tokens offers a very clear competitive product: massive yields to borrowers who borrow ZAI and multiply their Pendle yields. We plan to allow users to leverage their yields anywhere from 10-20-100x, making ZAI the only stablecoin that can provide high leverage at low-interest costs.
Try it out!
We encourage users to report any bugs or issues here to help us improve your experience.
Feel free to visit https://app.maha.xyz/
Report bugs, issues, or give general feedback: https://docs.google.com/forms/d/e/1FAIpQLSdSq5aaL5MO8r0XKoE4RHh7MwwNKFCC0VrECAUPgvb4SydhlQ/viewform?usp=sharing