MTR - The Metastable Coin

What is MTR?

Meter Stable (MTR) is the unit of account and medium of exchange of the Meter network. It is a fully-decentralized, permissionless, low-volatility cryptocurrency that is created using SHA256 Proof of Work, the same method used by Bitcoin.

Meter uses the cost of production and the PoW miners’ arbitraging behavior to establish a long-term equilibrium price for the market. This equilibrium price essentially anchors MTR to the global competition of electricity prices, which is more stable in real value than any fiat currency, based on historical data.

The supply of MTR is uncapped and is designed to automatically expand or contract with fluctuations in its usage. This makes the value of MTR neither deflationary or inflationary in the long run.

What is MTR used for?

Externally, MTR can be used to make everyday payments and as a store of value.

In the Meter network, MTR is used to pay transaction, gas, and storage fees to PoS validators who approve transactions.

Additionally, MTR can be converted to MTRG through a competitive bidding process. In Bitcoin, the miners directly use their hash power to compete for the newly created Bitcoins. In Meter, the miners first convert their hash power into mining credits (MTR) and use MTR to compete for MTRG. Please refer to the "On-Chain Auctions” section for more information.

How is Meter different than other stablecoins?

Meter solves many of the issues that existing stablecoins face.

Fiat-backed stablecoins like USDT and USDC are centralized and thus are subject to regulatory restrictions.

Crypto-backed stablecoins like DAI have capacity issues and rely on oracles, and thus face systemic instability risk.

Meter's full decentralization and permissionless nature is designed to avoid such systematic risks. It gives up strong pegging to USD, but maintains an economically stable value and eliminates counterparty, regulatory, and oracle risks typically found with crypto- and fiat-backed stablecoins.

Read more here: https://www.meter.io/why-meter-is-different-than-other-stablecoins/

How does MTR maintain stability?

Each MTR is created with 10 kWh of electricity using SHA256 Proof of Work, the same method used by BTC.

Miners’ profit chasing behavior will drive the coin to the cost of global competitive electricity price, which is more stable in purchasing power than any fiat currency in the world. When the price of MTR goes up, miners, who are profit-driven, will allocate more of their mining equipment to mining MTR; when the price of MTR decreases, they will point their mining equipment to other PoW chains.

Their actions will cause the Meter block reward to elastically change in response, which will bring the price of MTR back to its equilibrium or competitive state.

In Bitcoin, miners use hash power to directly bid on newly created BTC. The block reward is constant, but the price is not. In Meter, miners convert their hash power to mine MTR, where the price is constant but block rewards are variable based on total network hash power.

We expect the market price to settle in the 0.7 to 1.5 USD range and will be more stable as it grows.

Meter has a reserve mechanism to account for larger price fluctuations.