NEPRIM provides autonomous and non-custodial stablecoin infrastructure.
Three major problems confront stablecoin users:
significant fragmentation in same-peg assets
lack of native yield when it is being increasingly demanded by users
lack of protection against permanent capital loss
Our products (MINT, SWAP, and EARN) will be built specifically to address these pain-points.
NEPRIM assets (hereafter niAssets) represent some underlying value peg and are minted/redeemed on-chain via smart contracts. niAssets are backed 1:1 by a basket of existing tokenised same-base assets (hereafter sbAssets).
Each niAsset is a liquidity share for its asset pool as well as a medium of exchange, unit of account and store of value in its own right.
Each niAsset has an outsized native interest rate that is derived from lending sbAssets on third party lending protocols, fees collected from NEPRIM’s SWAP product, and other sources of income.
Users can swap between sbAssets with zero price slippage, regardless of order size. For example, in nYUSD (NEPRI YieldUSD), users are able to swap 1 nDAI for 1 nUSDC at no cost, except a small fee.
Those who hold $NEP can stake their tokens to become governors, allowing them to participate in governance of the system. In order to achieve long-term value of $NEP, these governors are motivated to seek stability through the growth and diversification of NEPRIM.
The NEPRIM will enable an Incentivized Constant Sum Market Maker that enables guaranteed liquidity across stablecoins, both when swapping underlying stablecoins and when redeeming niAssets. Modelling shows large increases in system arbitrage and swap volume, and therefore protocol revenue. The upgrade is gas efficient and makes NEPRIM more composable with other DeFi protocols.
NEPRIM assets (niAssets), such as nYUSD and for example nBTC, feature a constant sum market maker, where users can mint and redeem the underlying basket assets (sbAssets) on a 1:1 basis. The 1:1 swap feature has many benefits, such as zero slippage. However, some problems have been identified. For example, the most expensive sbAsset is always drained out of the basket, and the cheapest one always fills it up. To remedy this (as well as to cap system risk), we enforce weight limits, which prevent users from increasing the weight of any sbAsset above its maximum proportional representation.
Introducing incentive curves will effectively turn niAssets SWAP into fully-functional AMMs with guaranteed liquidity, increased composability, and ultimately higher swap volumes.
“Incentive curves” keep basket weights within a desirable range. Depending on how their actions affect sbAsset weights, users might pay a penalty or be rewarded a bonus, as defined by these incentive curves.
Notable features of penalty curves:
Gas efficient: It doesn’t cost much gas to compute the penalty or the bonus.
Flexible and fully customisable: Any desired range of weights can be targeted with incentive curves without additional overhead.