Metronome Synth Glossary
DAO - A decentralized autonomous organization (DAO) is an emerging form of legal structure that has no central governing body and whose members share a common goal to act in the best interest of the entity. Popularized through cryptocurrency enthusiasts and blockchain technology, DAOs are used to make decisions in a bottom-up management approach. https://www.investopedia.com/tech/what-dao/
Synthetic Asset - Synthetic assets are simulated representations of real-world assets on the blockchain. A synthetic asset is like a crypto instrument that tracks the price performance of an external asset without being backed by the actual asset.
Multi-Synthetic - Through Metronome Synth, users are able to mint multiple synthetic assets across various blockchains and ecosystems. With this Multi-Synthetic approach, users are not limited to the assets on a single chain.
Collateral - Collateral refers to assets deposited in order to mint synthetic assets
Multi-Collateral - Metronome Synth is multi-collateral, which means that there are multiple different assets, across multiple chains, that can be deposited as collateral.
Oracle: Oracles provide a way for the decentralized Web3 ecosystem to access existing data sources, legacy systems, and advanced computations. Decentralized oracle networks (DONs) enable the creation of hybrid smart contracts, where on-chain code and off-chain infrastructure are combined to support advanced decentralized applications (dApps) that react to real-world events and interoperate with traditional systems. https://chain.link/education/blockchain-oracles
Oracle Price: Utilizing Chainlink as Metronome Synth’s Oracle provider, the Oracle Price is the price that Chainlink broadcasts to Metronome reflecting the value of the underlying asset for each synthetic or collateral.
Collateralization Factor (C-Factor) - The C-Factor (Collateralization Factor) is a rolling number ratio comparing the value of deposited collateral assets to that of minted synthetic assets. The C-Factor also represents the likelihood of liquidation as it decreases toward the threshold.
Collateralization Threshold - Similarly to the C-Factor, the Collateralization Threshold is a number that represents the minimum amount of value to be retained by held collateral with respect to the synthetic assets minted. The threshold is the value at which the collateral and minted asset value are equivalent. A positive threshold represents a healthy portfolio without liquidation, whereas a zero, or negative threshold represents a portfolio that must be rebalanced or liquidated to reach the threshold. MET Yield Farming - MET Yield Farming enables users to potentially boost their APY by generating synthetic assets from productive assets. The resulting synthetic asset is then “looped” into collateral in order to repeat the process and yield additional synthetic assets: effectively looping yield-bearing assets to multiply APY with the added leverage from synths generated. Productive Collateral - Collateral which is yield-bearing in nature. Posting productive collateral allows the user to increase their capital efficiency and boost APY with minted synthetics which can be traded for additional productive collateral and re-deposited. An example of productive collateral, would be the vaETH token from https://vesper.finance. vaETH is a yield bearing token where users can deposit ETH into Vesper’s vaETH pool, and earn yield on their deposit paid in ETH.
Synth Marketplace - Synth’s in-house DEX market for synthetic assets that allows users to swap between various synthetic assets.
Protocol Owned Liquidity - Protocol Owned Liquidity is liquidity that has been provided by the Metronome Treasury for the Metronome token ($MET), msETH and msUSD.
Liquidation - Liquidation is what occurs If/when the value of the synthetic assets falls in value below the required collateral ratio. A liquidation can be done partially, or in full depending on the C-Factor at the time of liquidation. When a liquidation occurs, a user's synthetic positions are closed to bring the C-Factor into a healthy state.
Last modified 4mo ago