Why loreUSD Is Your Next Essential Stablecoin on Scroll
We’ve always envisioned a story for Lore that reached beyond a standard money market. Soon, the protocol will transform into a modular lending powerhouse that issues its own stablecoin.
Enter loreUSD—a stablecoin engineered for the Scroll zkEVM network, offering unmatched stable opportunities.
Backed by the most popular assets on Scroll, and the latest Cod3x Collateral Debt Position (CDP) Module, loreUSD collateral will bootstrap lending market liquidity and create a native source of sustainable yield for minters. It provides a decentralized alternative to USDT and USDe, with minimal counterparty risk. The result is a positive feedback loop of efficient borrowing, yield generation, and the most competitive rates across the entire Scroll network for lenders and borrowers.
loreUSD vs. Traditional Markets: Where Should Your Assets Go?
Everyone’s DeFi strategy is different. Should you park your assets in the Lore lending market, or is minting loreUSD the smarter play? Here’s a summary of each option to help you on your way:
- Using the Lore Lending Market: Great for those looking for a straightforward yield from lending. You’ll earn from the market’s interest rates, which is reliable but can fluctuate based on borrower demand.
- Minting loreUSD: By minting loreUSD, not only do you unlock a stablecoin backed by your assets without selling them, but you also tap into a yield mechanism that’s enhanced by Lore’s Integrated Lending technology. Your collateral doesn’t just sit there—it generates yield that funnels back to stablecoin stakers. Furthermore, loreUSD stakers earn income from liquidations, as their capital is used to guarantee healthy markets.
Minting loreUSD
- Open the Lore Dashboard: Navigate to the minting interface on the Lore app.
- Select Your Collateral: At launch, you can use ETH, USDC, STONE, wstETH, weETH, and pufETH. Choose the one that fits your strategy.
- Enter Your Amounts: Decide how much collateral you want to deposit and the amount of loreUSD you wish to mint. The system will guide you with the minimum and maximum amounts, so you’re never in the dark.
- Approve and Mint: With a simple click, confirm your transactions in your wallet. Once approved, your loreUSD is ready to be put to work.
Managing Your Position
Maintaining a healthy position is a simple process. You know how on Aave the dollar amount supplied must always be more than the amount borrowed? It’s the same with loreUSD — the position must stay properly over-collateralized to avoid a liquidation. Ensure your Personal Collateral Ratio (CR) stays above the minimum (MCR) required for each asset. If your position is at risk of liquidation, consider adding more collateral or repaying some of what you’ve borrowed.
A liquidation occurs when a collateral ratio falls below the minimum required amount. In the event of liquidation, a position will be closed by the system, debt repaid, and collateral forfeited to the Stability Pool depositors. You can read more about how the Stability Pool works in the loreUSD documentation.
Now that your have minted loreUSD and aware of how to maintain a healthy position, let’s explore how you can maximize the benefits of Scroll’s native and most advanced stablecoin.
Why loreUSD is the Stablecoin You’ve Been Waiting For
So, what makes loreUSD different from other stablecoins out there? In a word: Yield.
- Stability Pool Rewards: Deposit your loreUSD into the Stability Pool, and you’ll earn rewards not only from protocol incentives, but from liquidations as well. This system converts market volatility into yield for Stability Pool providers, all while they hold a stable asset. Check out an example of a Stability Pool depositor earning liquidation income in the loreUSD documentation.
- Zero-Interest Loans: Need liquidity without wanting to keep track of interest paid on your borrows? Minting loreUSD is interest-free.
- Arbitrage Opportunities: While loreUSD mechanics establish a soft peg to the US dollar, its value can fluctuate between $0.995 and $1.05. The reason for this is due to the liquidation and redemption mechanisms put in place to keep the system healthy. Therefore, savvy-Scrollers may notice that market fluctuations can create profitable gaps. Redeem below $1 or mint above $1 for profitable arbitrage. This mechanism not only benefits you but also keeps the loreUSD peg strong.
Getting Started with loreUSD: Your Next Steps
Ready to explore DeFi on Scroll with loreUSD? Here’s how you can set off on the right foot:
- Mint loreUSD: Head to the Lore app and mint your stablecoin as per the steps outlined above. It’s quick, easy, and opens up a world of opportunities.
- Stake in the Stability Pool: Deposit your loreUSD for stable rewards. It’s the simplest way to start earning from day one.
- Provide Liquidity: Provide liquidity for trading fees and LP rewards on Scroll’s most popular DEXs.
- Explore Arbitrage: Keep an eye on the peg. When the market moves, so do your opportunities for profit.
Write Your Chapter in the loreUSD Story
We’re here on Scroll to make DeFi fun again.
Whether you’re staking in the Stability Pool, taking out a zero-interest loan, seizing arbitrage opportunities, or providing liquidity, loreUSD empowers you to take control of your financial story.
So, why settle for the ordinary when you can be part of something extraordinary?
Mint loreUSD, and start writing your chapter in the future of decentralized finance.
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