Lybra Finance Invites Users to Test New Stablecoin on Arbitrum's Goerli Network
Lybra Finance, the stablecoin issuer, has announced the launch of its v2 testnet on Arbitrum's Goerli network. The move aims to attract more high-frequency traders and decentralized finance (DeFi) users to Lybra's yield-bearing stablecoin offerings.
As part of the testnet launch, users are encouraged to try out Lybra's new stablecoin called peUSD. It is claimed to be more compatible with decentralized finance protocols compared to the protocol's main stablecoin, eUSD. To incentivize participation, users can earn rewards by completing various tasks on Zealy and providing feedback, with the complexity of the tasks determining the number of points earned. For a detailed step-by-step guide, please refer to this article.
Lybra Finance allows users to mint eUSD, an interest-bearing stablecoin, using ETH and LSTs (Liquid Staking Tokens) as collateral. Additionally, with V2 it introduces peUSD as an Omnichain DeFi utility version of eUSD, further enhancing the ecosystem's utility and versatility.
To maintain the stability of eUSD, Lybra employs a combination of overcollateralization, liquidation mechanisms, and arbitrage opportunities. This ensures that the value of eUSD remains close to its 1 USD peg. Holders of eUSD can expect to earn a base annual percentage yield (APY) of approximately 7.2%, providing a stable income stream while retaining exposure to the cryptocurrency market. Moreover, as the price of ETH rises, the yield generated by eUSD holders may also increase.
Lybra Finance differentiates itself from other stablecoin protocols by offering zero minting fees and zero loan interest for users. This feature allows users to leverage their ETH holdings and mint eUSD stablecoins without incurring additional costs. The introduction of peUSD expands the protocol's user base and provides more flexibility in interactions with the platform.
A notable feature of the v2 update is the ability to convert eUSD to peUSD without sacrificing the accruing interest on the initial eUSD. This feature enhances the protocol's resilience, and the converted eUSD can be used for flash loans, contributing to efficient liquidation and further stabilizing the protocol's fund.
The testnet launch arrives amid significant growth in Lybra Finance's market capitalization. Over the past 30 days, the market capitalization of eUSD has surged by 152%, reaching $198 million as investors deposit staking tokens to mint eUSD. Moreover, Lybra Finance's total value locked is nearing $400 million, marking a substantial 108% increase in July, according to data from DefiLlama.
