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Midas aims to compete with Ethena Labs by launching its new yield-generating token, mBASIS. mBASIS currently offers a yield of about 12%, Midas founder Dennis Dinkelmeyer said.
Midas, a tokenization platform backed by Coinbase Ventures and other investors, has launched its new yield-generating token called mBASIS.
mBASIS is a dollar-denominated ERC-20 token designed to generate returns through a delta-neutral basis trading strategy, Midas announced Thursday. Delta-neutral basis trading involves profiting from price differences between the spot and perpetual futures markets. By taking a long position in the spot market and a short position in the perpetual futures market (or vice versa, if futures are lower than spot prices), the trade captures the price difference, i.e. the basis difference, as profit and maintains a delta-neutral position.
The mBASIS token is similar to Ethena Labs’ yield-generating token sUSDe. sUSDe is a staked version of the USDe “synthetic dollar” and similarly uses a delta-neutral basis trading strategy to generate returns. Since its launch earlier this year, sUSD has rapidly gained popularity and is now a leader in the yield tokens category with a market cap of $1.65 billion.
Midas decided to launch mBASIS because it thought it could develop a better product than Ethena Labs, said Fabrice Grinda, Midas’ executive chairman.
Midas currently already offers a yield-generating stablecoin called mTBILL. This stablecoin is backed by US Treasury bonds and is more suitable for bear markets. However, in bull markets people are looking for returns beyond the risk-free rate of return offered by mTBILL, Grinda said.
“In bull markets, people expect Bitcoin and Ether prices to rise in the future. You can make returns by buying spot and shorting futures. When the market is extraordinarily frothy, as it was in March, this has generated over 50% annual returns,” Grinda told Aucland, Zingy and OLX. Co-founder and former CEO of and a serial angel investor.
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