Mint

Learn how to mint assets on Mirai for self-collateralised positions

About

Mirai "Mint" feature allows users to simulate a borrowing strategy that involves recursion. This function allows users to create equal amounts of both deposits and debts for a specific asset. Mint is often used as a starting point for constructing leveraged long or short positions, or when participating in liquidity mining programs, where borrowing and lending on certain markets are incentivized.

Example

To begin, a user makes a deposit of $1000 worth of USDC into their Mirai account. Next, they use the Mint function to create an additional $5000 of USDC. This results in a total of $6000 worth of USDC deposits and $5000 worth of USDC debts in their account. This gives them a leveraged position, as the amount of debt they hold is greater than what their initial deposit alone would have allowed for.

The Mint feature mimics the effects of a recursive borrowing strategy, where a user deposits $1000 USDC, borrows $900 USDC, redeposits that $900 USDC, and then borrows $810 more USDC, repeating this process multiple times.

Step-by-step

When using the Mint feature on Mirai, it's important to ensure that you have enough collateral in the sub-account you plan to mint from.

To begin, select the Mirai sub-account that you want to use, then choose the asset you're interested in. Enter the amount you wish to have upon completion.

The "Max" option is representative of 19x leverage, which is right at the edge of a liquidation, so it's generally not recommended to mint more than the "Safe Max" option.

Selecting "Safe Max" will mint enough deposits and debt to give you a leverage of 15x in your Mirai sub-account. Alternatively, you can select "0" or the "Burn" button to burn a previously minted position, which will remove an equal amount of deposits and debts from your account.

As you're entering the amount, be sure to take note of the Multiplier and Time to Liquidation figures to make an informed decision.

Please Note

Minting an asset creates a leveraged position, which poses the risk of liquidation if the value of the minted asset drops below a certain level relative to the user's collateral. Additionally, using the Mint function also involves the risk of loss due to fluctuating interest rates, which are determined by the market conditions. Therefore, if you choose to use the Mint feature, it's important to be aware of and manage these potential risks.