I’m curious what’s going to happen if a stablecoin goes to 0, or it’s faced with a strong permannent correction -30% to -99% ), the funds are off-chain generating interest, as such, are mAssets owners safe from a specific stablecoin crash ? As the funds can be re-introduced on-chain trough a different stablecoin, and mAsset owners can get a different asset.
For the sake of no clear examples, lets say there’s 2 stablecoins , with 2 mAsset pairs
USDa - mUSDa
USDb - mUSDb
There’s a problem with USDa and the currency pair with USD takes a strong downturn, there’s 200,000 mUSDa earning interest off-chain, that used to be USDa, but where converted to USD when taken off-chain, when these assets would be deposited back on-chain, should there be a way for the underlying mAsset to change, in order to protect the depositers ? mUSDa can be converted to mUSDb at a slight premium of convenience, in order to prevent them from getting an underlying stablecoin that is 0.7$ instead of 1$, and prevent them from receiving 70 cents on the dollar.
At the moment everything gathers interest from the initial contracts owned by the DMM Foundation, and in the future asset introducers, so far only a part of the USDC has been taken out of the contract to be deployed.
If the DMM ecosystem protects the deposits from single coin defaults, I can assume it’s a strong value proposition compared to other protocols, such as Curve, yet similar to how Aave, Compound and other single-coin deposits work.