Every 8 hours, the value of the MUSD is recalculated.

When collateral increases, many stablecoins increase the supply to maintain the peg or let it be overcollateralized. And when collateral decreases, many stablecoins have to lower the supply again to maintain the peg.

The value of MUSD is calculated by taking the total collateral and dividing it by the total circulating supply.

All transactions on MonoSwap that generate fees combined with all yield from Blast will have a portion of their amount converted to USDB and deposited into the MUSD collateral. This means that MUSD will now be overcollateralized. So, instead of letting it sit there like that, we will rebase the value of MUSD at the new rate.

The main sources of the MUSD collateral are coming from:

  • Public Minting

  • Gas Share Revenue

  • Yield from ETH & USDB

  • Swapping/Redemption Fees

  • Purchase of MonoChest

  • Alpha Referral

  • Other ad-hoc Revenue

In this sense, MUSD is a little better compared to other stablecoins.

  • Similar to countries appreciating their currencies when their economy is doing better, the better the ecosystem does, the more MUSD can appreciate in value.

  • The growth in value is collateralized by Blast's auto-rebasing USD-backed stablecoins and not backed by traditional crypto coins.

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