What is Amulet?

Amulet is an innovative set of smart contracts enabling users to obtain synthetics by way of self-repaying loans, called Advances, against their future yield on staking assets via Proof of Stake or LSTs. No Advances are ever liquidated as the synthetics are treated 1:1 with the native asset by the smart contracts.

Amulet users stake or lock their assets via Amulet to be deployed in a strategy of their choice. For ATOM Proof of Stake, this means ATOM is delegated on Cosmos Hub and earns Proof of Stake rewards as yield. Users can mint an Advance loan against their future staking rewards. As staking rewards are generated the loan balance is recalculated, reducing the balance of the loan over time.

Similarly, for ATOM LSTs (Drop’s dATOM and Stride’s stATOM), users can lock LSTs in a smart contract which tracks the redemption rate for the LST to calculate the rewards earned as yield from rebases, then mint an Advance against their rebase rewards. As the value of the ATOM LST goes up against ATOM, users with an Advance of their rebase rewards will see their loan balance reduce accordingly. Depending on the available LTV, users can mint further Advances or withdraw excess collateral as their loan balance goes down. At any time, users can repay their whole loan with their assets and close the position, withdrawing any excess subject to unbonding periods.