Mint and Destroy of MFIL
There are two ways to mint MFIL. One way is mint by SP pledging their existed Filecoin node to mint a certain portion of MFIL based on the node evaluation result. The other way is FIL holder to mint MFIL by swap their FIL to MFIL with 1:1 ratio. This also means that each MFIL is minted and backed by more than 100% FIL asset. When SP’s node expired, all MFIL minted from that node will be destroyed to avoid any excess. Therefore to anker each MFIL with FIL at the ratio close to 1:1. The detailed flows are showed as following:
Anyone who hold MFIL can stake their MFIL in the protocol to share the daily mining from the SP’s node in the protocol. The daily yield is allocated in the form of MFIL. Users can decided the time they want to stake & unstake. No other condition are required for every user.
Reward processing and disposition
The daily staking reward will be allocated to each user automatically by smart contract. When users received MFIL staking reward, they can choose to exchange MFIL to FIL in DEX. For those rewards which do not withdrawal from the protocol, they will be continuously staked in the protocol which increase the APR as the compound interest.
SP onbording and quit
MFIL provide a user-friendly and efficient liquidity solution for SPs. A four-steps onboarding process is required to be finished to better help the SPs to utilize MFIL protocol.
-Submit SP node info for evaluation：
SP who want to liquid their node can go to the MFIL website and find SP’s page to submit relevant info. Those info will go through a comprehensive evaluation model to assess SP’s technology capability and the node’s quality. Many criteria will be take into consideration such as operation stability, reward output volume, location of the data center etc.
-Determine mint volume based on evaluation：
Each node will be ranked after the evaluation to decide to how many MFIL can be minted by each node. Theoretically, the maximum mint volume of each node will not excess 90% of the FIL pledged in the node to ensure the 100% FIL coverage when mint MFIL.
-MFIL turnover flow
Once SP agreed the mint volume of MFIL, they shall give the control of the node to MFIL protocol. Smart contract will allocate the corresponding number of MFIL to SP’s address. SP can exchange the MFIL received to FIL in DEX/CEX or even in other DEFI protocol to get liquidity or leverage their asset to scale up their business with very low cost. SP will also get other benefit when they using MFIL protocol such as MFD token.
-MFIL destruction when node expired
When the node expired, the MFIL it minted shall be destroyed to ensure no excess MFIL is liquid in the market. The SP can return the MFIL they minted before to MFIL protocol to have their node back. If the SP do not return the MFIL, the pledged FIL in the node will be use to purchase back the corresponding number of MFIL from the market and destroyed by MFIL DAO. Therefore to keep the balance between MFIL and FIL.