When Mycelium first embarked on its DeFi journey, it was early 2021. Tracer DAO had just launched, and the promise of engaging with smart contracts on-chain was an exciting one. COVID had rocked the world and people were spending more time at home than at any other time in the past century. Armed to the teeth with new technology. Crypto and DeFi were part of that story.
Mycelium set out to change the way that people transacted by building smart contracts that dis-intermediated finance and created more transparency, guarantees, and access. Inspired by the early growth of DeFi, Tracer launched Perpetual Pools, a new primitive. Tracer was one of the first protocols to launch natively on Arbitrum, in August 2021. It was met both with excitement and confusion. Mycelium believed wholeheartedly in Perpetual Pools, and it was battle tested with security audits and liquidity. Despite that, it ultimately failed to find product-market-fit.
Recognising this reality, Mycelium reverted back to the initial exploration on Perpetual Swaps. A number of mechanism designs hit the cutting room floor, leading to the GMX codebase being forked with iterative changes. Perpetual Swaps launched, again on Arbitrum, in August 2022. In a competitive market, where liquidity rules and low margins hold teams to account, it was clear that here too, it would be difficult for the team to attract and maintain significant market share.
Failing to capture the hearts and minds of the DeFi community, and not making a significant enough impact on the market share of dominant platforms, the writing was on the wall. It should be acknowledged that during this same time, GMX has been on an incredible trajectory. Cumulatively seeing circa USD$139.8B in notional volume traded across Arbitrum and Avalanche. The team maintains an incredible amount of admiration for teams succeeding in DeFi. While Perpetual Pools and Perpetual Swaps contracts saw a couple of billion in notional volume traded, their traction paled by comparison.
So what now?
The time has come to find a continuation path for those that have participated in the Mycelium ecosystem. There are a number of projects that might be deemed mission aligned and representing a good result for token holders of the Mycelium token (MYC) and these options are now presented to MYC (and unconverted TCR) token holders to vote on a preferred outcome.
What happens to the MYC token?
Depending on the token holders’ preferred outcome, token holders will be entitled to convert for either LYRA tokens, Portal Gate tokens (to be released at a future date), or exchange for Mycelium Treasury assets, at the determined exchange rate.
Full details are available here: https://snapshot.org/#/myceliumproposals.eth/proposal/0x56ac08dec72d03180a5a52c7e6384eaf3321ccf94d8f9e8f593ab802dd285f06
What happens to Mycelium?
Many ex-team members have ventured out with other protocols, trading firms, and security audit firms, launched their own Web3 businesses, and continue to support other core DeFi services. The remaining development team yearns for its foundations in core infrastructure; which began prior to and separate from Tracer and Mycelium, and will focus on supporting Chainlink, Arbitrum, and non-custodial ETH Staking services under the brand Pier Two.
What happens to community channels and support?
The Mycelium Discord will be reduced to a single channel, called “Proposal Discussion”, and all other channels will be archived. Initially, this channel will be available for community discussion. Once an option under the Proposal is confirmed via voting, this channel will be archived, and a single channel called, “Important Information”, will host key information for token holders and those still positioned across Mycelium contracts and tokens. Comments will be disabled on this information channel to ensure clear and clean communication. Mycelium Twitter will remain online to share core information and updates, but no longer be considered active or regularly monitored. From the time that an option is confirmed, deposit functionality on mycelium.xyz will be deprecated and, following that, information will be released on how to withdraw positions via Arbiscan.