Magice Cube Finance
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FAQ
1. What is Magic Power Community?
Magic Power Community is a Meme culture driven community to open the door to Magic Cube ecosystem. It’s the “power of magic” that gathers a groups of crypto lovers, and with the shared common belief in breaking through the cages of history to make innovations and create a new era of decentralized finance.
2. What is MGP token?
MGP (Magic Power) is the governance token of the Magic Power Community with a total supply of 100 trillion MGPs. MGP is a decentralized Meme token managed by fully decentralized smart contracts, which will help the Magic Cube Ecosystem grow into a super powerful system of decentralized finance(DeFi).
3. How can I obtain MGP token?
There are mainly two ways for you to obtain MGP token. You can mine MGP by staking USDT to the mining pool, or you can buy / sell MGP on decentralized exchanges such Uniswap.
Besides, you’ll be able get MGP rewards in the later stages as the mechanism of MGP burning goes available.
4. What are Magic Cube synthetic assets?
The aim of mcAssets is to mimic the price trends of real-world exchange-traded underlying assets and give investors access to not only home markets but also foreign markets as well. While mcAAPL tries to closely represent the movements of AAPL stock, users are not afforded any rights of the underlying asset and tracking errors may arise due to the imbalances in trading volume in the underlying markets.
5. How are mcAssets actually traded?
mcAssets are traded through interacting with liquidity pools on Binance Smart Chain. For more information about the mechanism of the RingSwap, please see here.
6. Do I have to go through the KYC process?
Magic Cube aims to be decentralized in all aspects including whitelisting, governance, minting, and trading. As a result, as long as you have USDM balance, you are able to perform all functions available on both the Magic Cube protocol without any need to go through a KYC process.
7. What are the trading commissions composed of?
There is a fixed fee called the LP commission is 0.30% which serves as a reward for liquidity providers for Magic Cube-related pools on Binance Smart Chain. More detailed information can be found.
8. What does it mean to mint an mcAsset?
All mcAssets that are purchased or sold on Magic Cube were, at one point, minted. Minting is the process of providing collateral to issue a “synthetic” mcAsset.
Price oracles play an important role in the minting process and are used for two key functions: First, they help determine the amount of collateral required for minting an mcAsset. Second, they help determine whether sufficient collateral is backing existing mcAssets.
9. What hours can I trade and mint mAssets?
mcAsset liquidity is provided directly through the liquidity pools, and as such, they can be traded irrespective of market hours.
Unlike trading, the oracle feeder is used to price the value of mcAsset for minting. The oracle feeder stops operating when real-world market hours are closed, so minting transactions on Magic Cube will fail.
10. How do mcAssets keep their peg to real assets?
mcAssets are soft pegged to the oracle price, which means that the Magic Cube protocol does not directly rely on price oracles to determine the trading prices of mcAssets. Instead, Magic Cube relies on a combination of the minting liquidation process, arbitrageurs, and governance changes to keep mcAsset prices close to oracle prices.
Minting Liquidation
Take an example with an mcAsset like mcAPPLE. As the price of mcAPPL rises on the NASDAQ, minted mcAPPL may fall below the minimum collateral ratio (MCR) and trigger a liquidation event. When that happens, the Magic Cube protocol will automatically sell collateral to buy mcAPPL until the collateral ratio reaches the MCR again. This buying pressure created for mcAPPL will drive prices higher and will help the price of mcAPPL converge with the price on the NASDAQ.
Arbitrageurs
If the price of APPL on the NASDAQ were $1000, but the price of mcAPPL on Magic Cube were $900, an arbitrageur would buy the asset with the assumption that in the near future, with enough buying pressure, the mcAPPL price would eventually converge to the NASDAQ price of $1000. At that point, the arbitrageur would then sell mcAPPL at $1000, taking a profit of $100 per share. Similarly, if the price of APPL on the NASDAQ were $1000, but the price of mcAPPL on Magic Cube were $1100, an arbitrageur would provide collateral, mint the mcAPPL asset, and sell it at $1100 with the assumption that in the near future, with enough selling pressure, the mcAPPL price would eventually converge to the NASDAQ price of $1000. At that point, the arbitrageur would then repurchase mcAPPL at $1000 and then burn it to regain their collateral, taking a profit of $100 per share.
11. What are the benefits of providing liquidity?
Providing liquidity for the Magic Cube Protocol is equivalent to locking up your liquidity in Dwarf Pool. By doing so, you ensure that there is a sufficient supply of assets to be traded at any point in time. As compensation for providing liquidity, you will receive LP tokens which accrue trading commission charged by the protocol. In addition, staking these LP tokens provides inflationary rewards in the form of MAGC tokens.
12. Is there any risk to providing liquidity to the Dwarf Pool?
You are able to remove your liquidity provided at any point in time. While there is no risk of losing any of your liquidity in most circumstances, in the case of large changes in price of the tokens provided, the return on providing liquidity may be less than the absolute price variation (known as impermanent loss). This is the same risk faced by liquidity providers on Uniswap.
13. What can we do with Magic Cube tokens?
MAGC tokens have a variety of functions on the Magic Cube Protocol. The first and foremost functionality of the token allows holders to participate in governance on the protocol. In addition, by providing liquidity to the MAGC token pool, MAGC LP tokens issued can be further staked in order to receive CDP withdrawal fees in the form of MAGC tokens. Learn more here (连接跳转到MGC token)
14. Have the Magic Cube Protocol smart contracts been audited?
Yes, you can find the audits reports here.
Last modified 10mo ago
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