CVP Proposal: Stablis Finance | LST borrowing & overcollateralized stablecoin


Stablis Protocol revolutionizes decentralized borrowing on Metis by offering loans against yield-generating assets by introducing a non-custodial, efficient capital mechanism where loans are denominated in USDs, a stablecoin pegged to the US dollar.

Mission and Key Benefits

Our mission is to facilitate capital-efficient, user-friendly borrowing against yield-bearing assets like stMETIS. We offer significant advantages, including:

→ Low interest rates on loans

→ Low minimum collateral ratios starting at 125%

→ Liquidity re-utilization across DeFi protocols on Metis

→ STS stakers will earn 100% of protocol revenue

This enhances capital efficiency and also fosters a robust, secure borrowing environment.

Innovation and Community Value

Stablis extends the Liquity codebase to enable multiple collateral types and ensure a broad spectrum of Metis protocols can integrate seamlessly. Our dual-token system, featuring $USDs for stablecoin loans and $STS for protocol governance and revenue sharing, incentivizes both borrowers and stability providers. Our ecosystem fosters a participatory, secure environment for users, highlighted by our commitment to audits and non-custodial principles.

Core Features

Chests: A Chest is where you initiate and manage your loan. Each Chest is associated with a Metis address, and each address can only have one Chest per collateral type. If you are familiar with Vaults or CDPs on other platforms, Chests share a similar conceptual framework.

Chests maintain two balances: one consists of assets serving as collateral, and the other represents a debt denominated in USDs. You can modify the amounts of each by adding collateral or repaying debt. As you make adjustments to these balances, the collateral ratio of your Chest changes accordingly. You have the flexibility to close your Chest at any time by fully repaying your debt.

Stability pool: The Stability Pool acts as the primary safeguard in upholding system solvency. Its role is to act as the liquidity source for repaying debt from liquidated Chests, ensuring a consistent backing for the total USDs supply.

When a Chest gets liquidated, an amount of USDs equivalent to the remaining debt is burned from the Stability Pool, settling the debt. In return, the entire collateral from the liquidated Chest is transferred to the Stability Pool.

Stability Providers, who contribute USDs to the pool, fund the Stability Pool. Over time, Stability Providers experience a pro-rata reduction in their USDs deposits but gain a pro-rata share of the liquidated collateral. Given that Chests are likely to be liquidated just below the minimum collateral ratio, it is anticipated that Stability Providers will receive a greater dollar-value of collateral relative to the debt they settle. Any collateral received by Stability Providers is free to be traded back to USDs or other assets.

Redemption mechanism: We implement a redemption mechanism to support USDs’ $1 soft peg. As soon as USDs goes under peg, there is an incentive for arbitrage traders to buy USDs on the open market and redeem against collateral of the Chest(s) with the lowest collateral ratio. This arbitrage creates demand for USDs and brings it back to peg.

It’s the process of exchanging USDs for any collateral type asset at face value, where 1 USDs is always considered exactly worth $1. In this process, for x USDs, users receive x dollars worth of chest collateral in return. Users have the flexibility to redeem their USDs at any time without limitations.

STS Staking: From the moment users stake their STS in the staking vault, they will start earning real yield from the borrowing and redemption fees corresponding to their share of the total staked STS tokens at the moment the fees are generated. Also 100% of the interest fees will go directly to the STS stakers. Stakers have the flexibility to withdraw their staked assets at any time as there isn’t a lock-up period in place.

Governance: STS token holders are empowered with the right to cast their votes on important Stablis governance proposals. The main focus of these proposals will be to fine-tune borrowing fees and interest rates, ensuring that Stablis remains aligned with the ever-evolving market standards and rates. This dynamic governance structure is designed to keep our protocol competitive and responsive to the needs of our community.

What Stablis means for Metis

By leveraging the Metis blockchain we introduce a groundbreaking approach to unlocking more capital. It enhances the Metis ecosystem by enabling interest-free loans against yield-generating assets, thus promoting capital efficiency and financial inclusivity while significantly expanding Metis’ total value locked (TVL). Stablis’ integration into Metis not only diversifies the blockchain’s DeFi offerings but also attracts a broader user base seeking innovative, low-risk borrowing solutions. This symbiotic relationship fosters growth and stability within the Metis ecosystem, contributing to its overall value proposition and appeal to both developers and users.

$STS Tokenomics*

Max supply: 100M

  • Community Incentives: 45.7M
  • Airdrop: 0.3M
  • Public Sale: 20M
  • Team: 16M
  • Advisors: 4M
  • Treasury: 10M
  • Initial liquidity: 4M (Locked)
    *subject to change

Pre-Launch Roadmap

Request for CVP Status

Given our innovative approach to DeFi on Metis, adherence to high security standards, and commitment to community engagement, we propose that Stablis be granted Community Verified Project status. This recognition will not only validate our efforts but also enhance our visibility and trust within the broader DeFi community.

We look forward to the feedback and are happy to provide any additional information required.


Stablis represents the forefront of LSD based borrowing solutions on Metis, with a focus on security, efficiency, and community empowerment. As such, we believe Stablis is an exemplary candidate for CVP status, promising to contribute significantly to the ecosystem’s growth and stability.

More Information

Website: Stablis

Twitter: Stablis Protocol :herb: (@StablisProtocol) on X

Discord: Join the Stablis Protocol Discord Server!

Docs: General | Stablis docs



From the look of things Stablis Protocol is playing a pivotal role in revolutionizing borrowing with its interest-free loans backed by high-yield assets and USD denomination. Its standout features like 0% interest, efficient liquidity utilization, and low collateral ratios make it a game-changer. The ability to directly redeem USDs for collateral adds to its appeal. From borrowing to securing the protocol and staking $STS, Stablis offers diverse use cases, while its tokens, USDs, and STS, provide additional incentives. However, users should be aware of potential risks, particularly in liquidation scenarios. Built on the robust Liquity codebase, Stablis stands as a beacon of innovation with its multi-collateral approach. And this will surely Change the Metis ecosystem


Keep up the good work team :fire:
Looking forward for whats coming :heart_hands:

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Stablis Finance seems like a perfect product to launch at perfect timing on MetisL2!
It presents a compelling solution for decentralized borrowing.

Capital-efficient, user-friendly borrowing against yield-bearing assets is the way forward!
I am rather interested in this project and am definatelly planning participating a lot here.

Curious about the security aspects and audits though.
Also, previously it was mentioned that there are zero interest loans. Here it says “Low-interest loans”. Would be nice to clarify.


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Following this project very closely as I think Metis is going to benefit greatly from their platform. With a presale coming soon, I’ll definitely be participating and am excited to see the kinds of yields that will be available post launch.

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Hi Jack, thank you for your feedback. Our audit has been locked in with Omnisia. We’re finalizing our last smart contract updates as we speak. Regarding the interest, good catch :smile: we indeed decided to introduce interest on outstanding loans to bring the protocol in line with the current market standards and rates. Interest payments will be determined by governance vote and 100% will be paid out in as real yield to STS stakers, adding an additional and very profitable revenue stream for our investors.

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I can’t wait for Stablis protocol to finally become Community Verified Project (CVP) on the metis ecosystem. The Stablis protocol’s mission when gradually actualize is going to bring a steady inflow of users to the Metis ecosystem. The decentralized borrowing feature of metis could potentially allow degens like me to fully optimize their funds in taking part in the ever increasing opportunity in the crypto market without having sell their favorite crypto. Kudos to the team and hope you guys will consider being a community centric protocol.

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No interest on loans is just amazing buh if i may ask, how are you making your money?
If seen in the comment where they’ll be interest on outstanding loans, what if everybody that loans payback on or before the date?

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Regarding the interest on outstanding loans I think that is correct decision to be honest.
Zero interest rates model seems less stable especially in the long run.
…and we all love extra yield too)

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Metis and every user on the ecosystem will benefit if they’ll pariticipate. I’m glad I found out. Looking foward to see the Yields and ofcourse the NFT’s which will give a boooooooooost.

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Stablis Protocol’s shaking up the loan scene with this. I really like the look of it and will be interesting to try this one out. Seems to be built on a strong foundation and will become a big deal for the Metis ecosystem. Super interesting.

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Nice I’m loving the opportunities Stablis bring with LSD borrowing solutions

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Hi Arr3, as mentioned in our proposal, we do have interest which will be a source of real yield for STS stakers.


It is nice to see such opportunity made available by Stablis Protocol.

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This proposal is not just incredible, it’s mind-blowing! The level of innovation and potential impact is off the charts. I can’t wait to see how it unfolds. :star2::dizzy:

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Stablis Protocol aims to create an efficient and effective DeFi platform on the Metis ecosystem. Kudos to the team for the CVP proposal. I’m looking forward to great things ahead on the Stablis platform.

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Following this proposal closely. With numerous staking protocols applying for BMR, likely many with unique liquid staking tokens, there will likely be a need in the ecosystem to transfer LSTs back to a stablecoin. Whether DEXs can keep up with all LSTs with LST/stable swaps remains to be seen, and this protocol may supply an easier solution to maintain liquidity for newly introduced LSTs.

I’d like to hear more about the liquidation process; specifically more about what triggers a liquidation. Ideally this protocol will be useful for the users of the protocol, STS holders, builders and ecosystem, but I worry about massive liquidation events in the case of a large loss of staked token value (collateral) within a chest. Are there ways to stabilize chests to prevent liquidation if there is a large drop in value of the collateral asset? Thank you for your proposal - am very intrigued.

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Hi Coffee_Break,

thank you for taking time to write your reply, we very much appreciate it!

Regarding the liquidation process there are 2 ways a Chest can get liquidated. Either a Chest’s collateral value drops under the minimum required collateral ratio, which automatically triggers a liquidation or the most risky vault(s) get (partly) redeemed against to support USDs soft peg.

It’s the vault owner’s responsability to keep their vault healthy at any time to avoid liquidations and redemptions. If a significant drop in collateral value occurs, it’s in their best interest to check the vault as soon as possible and -if necessary- add more collateral to bring the vault back to a healthy collateral ratio.

You can find more information on the liquidation and redemption mechanisms in our docs :point_down:

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Metis will definitely benefit from the features that Stablis Protocol brings. Kudos to the team!

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Stablis Protocol is building a top-notch DeFi platform on Metis. Excited about their CVP proposal and what’s to come!

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