Alpha For You – MetaStreet

TLDR:

• Metastreet is an established liquid credit platform 

• Nearly $100mm in loans facilitated

• Moving beyond NFTs to any digital and real world asset that finds PMF on-chain

• Backed by some of the best in crypto

• Signing up partnerships with the sharpest CT favorites

• Just dropped its airdrop points campaign today

• Campaign has significant day 1 boosts and benefits 

• Token will be airdropped as a ERC404 token, which MetaStreet will also provide lending solutions for

• Depositing wsteth and sharing invite codes gets you to earn XP from this high quality project 

• If you are reading this, you are early.

Today we’re going to be doing a free and quick deep dive on a project that is picking up a lot of attention ahead of its ASCEND airdrop/points campaign that dropped today.    The project is MetaStreet, which gained initial traction as a leading lender for NFTs.    The protocol is backed by Dragonfly, Opensea, Animoca, Mirana and others, and with its legacy NFT lending offerings has amassed $20mm in TVL and $88mm in cumulative lending volume.

But MetaStreet is going above and beyond NFTs, to be the go-to provider of onchain credit for illiquid assets.  And with their incentive farming program that launched today, there is a real opportunity for early users to position for the eventual MSTR airdrop. The team has already lined up partnerships with CT heavy hitters like Andrew Kang and Sisyphus which will drive a lot of attention and volume to the protocol.   After the ASCEND campaign, the MSTR token will be airdropped as an improved 404 token/contract, which will also bring its own level of hype, attention and upside.

How to Position for the Campaign:
First and foremost, this points campaign that dropped today will be live for a limited time, so early action will be rewarded.   ASCEND will end in 3 months or less.    Additionally, 1^st day depositors can earn up to +300% in extra points, with bonuses decreasing each day. To get involved, users can deposit LSTs like wsteth and mint a liquid credit token (mwsteth) that yields ~17%. You can also farm blast points using Metastreet, by looping LCTs.   Users can also farm points via their “Prestige Actions” which includes sharing invite codes, completing social quests and holding specific NFTs.

How does MetaStreet Work:
The project uses its innovative “Automatic Tranche Maker” to automatically organize capital in a pool based on depositors’ risk/return profiles. If you aren’t familiar, tranches are a very popular TradFi mechanism, where debt instruments like a mortgage, car loans or even credit card debt are sliced up based on risk and time to maturity.   If that’s confusing, let’s use a simple example:

Let’s assume a Crypto Punk is worth 100E, and 3 lenders with varying risk appetites want to provide credit.   At a 60% loan to value (which is just the loan amount vs. the total value), the borrower sees 60 ETH of lending liquidity for their punk.   But the lender side is split up amongst the 3 credit providers. 

While the borrower will see just one simple interest rate, the lenders receive different APYs based on where they sit in their respective tranche or position in the capital stack. And this is why MetaStreet’s ATM is very cool, because it allows riskier credit providers looking for yield to take advantage of the “risky” part of the capital stack, while low risk providers can sleep comfortably knowing that their lower rate is protected by a lower loan-to-value. Its obviously not without risk: the risky tranche in this example takes a 50% loss on their principal if our hypothetical Punks fell 17% to 50E, while the other 2 tranches remain whole. MetaStreet also dynamically allows credit providers to compete on loan duration, with longer duration loans getting utilized first (so in the below example, the C1 lender offering 60e for 30 days would see their capital utilized first).

Other important mechanical things to know about MetaStreet and why it improves on shortcomings of existing lending protocols:

·         Oracleless: Remove the dependency on a centralized price oracle for loan to value limits

·         Dynamic Interest Rate Model: Replace a fixed, governance-driven interest rate model with a dynamic, deposit driven one

·         Permissionless: Allow users to instantiate a lending pool for any collection permissionlessly

What’s Next For MetaStreet:
We briefly touched on how the protocol has been a leader in NFT lending (nearly $100mm in loans facilitated), but as the DeFi space grows, MetaStreet is able to handle any tokenized illiquid asset on chain.  MetaStreet is also coming to Blast with its LCTs to be bridged and integrated with Thruster and other partners there.    But to me the biggest tailwind for the project is the explosion of the ERC404 space, which has effectively made NFTs “cool again”.   Because the platform is permissionless, lending pools can be created by anyone for ERC404s on MetaStreet, effectively making it one of the first movers in the 404 lending space.    While 404s from a market cap perspective are still smaller than the broader NFT total market cap, the volume is 2.5x higher and the attention even higher still.   MetaStreet could very well be a go-to-place for lending solutions on 404s (I believe PANDORA lending pools will be boosted in ASCEND as well).

In Summary:
MetaStreet is an established liquid credit platform with nearly $100mm in loans facilitated, is moving beyond just NFTs, is backed by some of the best in crypto, is signing up partnerships with the sharpest CT favorites, is dropping its airdrop points campaign today, which has significant day 1 boosts and benefits and will be airdropped as a ERC404 token, which they also provide lending solutions for. Depositing wsteth and sharing invite codes gets you to earn XP from this high quality project and if you are reading this, you are early.

Some codes to get you all started:

ascend.metastreet.xyz/i/v800x

ascend.metastreet.xyz/i/iwz6k

ascend.metastreet.xyz/i/m03gg

ascend.metastreet.xyz/i/emdef

ascend.metastreet.xyz/i/k2hf8


Disclaimer: This educational piece was created in collaboration with @TailoredWeb3. This content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice. The author may also have positions in the tokens mentioned in the content, so please do your own research.