How to use Mercurial Finance: A step by step guide

In this paper, we would like to guide you how to use Mercurial Finance (MER) - Solana's first Multi Token Stable Swap, include: what you need to prepare before starting to use Mercurial Finance, how to swap, add & remove liquitidy, how to use wormhole and some FAQ about Mercurial Finance. Let's get started!

Mercurial Finance Overview

Mercurial Finance is the first Solana-based project, a protocol for stablecoin trading on the Solana blockchain. It can be seen as similar to Curve Finance on Ethereum. For now, it has supported stablecoins such as USDC, USDT, PAI, wUST, etc.

Mercurial's competitive edge is dynamic fees and low slippage. 

How to start using Mercurial Finance

Prerequisites for trading on Mercurial Finance

First, users need to have a Solana wallet. In this article, we will use sollet.io wallet for example. Users can learn how to create and use Sollet Wallet as well as to add SPL Tokens, ERC20 tokens to it.

Other non-custodial and exchange wallets Mercurial Finance also interacts with include:

• Phantom Wallet - phantom.app
• Ledger - www.ledger.com
• Solflare - solflare.com

Preparing Solana (SOL) for the gas fees

To swap stablecoins on Mercurial Finance, users must have some Solana tokens (SOL). Users can buy Solana on a centralized exchange such as Binance and send them to the Sollet wallet.

Connecting Mercurial Finance with the Coin98 Wallet

Step 1: Visit the Mercurial Finance trading interface at mercurial.finance. Click on Connect Wallet at the top right corner of the screen.

Step 2: A list of different wallets will be displayed. Go ahead and choose any wallet to use. In this article, we chose the Coin98 Wallet. 

Step 3: Click Connect.

Step 4: Users will see the displayed notification as Wallet Update at the bottom left of the screen. It means the Wallet has been successfully connected, and users can start trading.

How to use Mercurial Finance

Swap Stablecoins

Step 1: On the Mercurial Finance exchange interface, insert the amount of stablecoins users would like to exchange.

Step 2: Click Swap and then Sign on the next screen.

Step 3: Users will see the finished transaction on the displayed notification.

Providing Liquidity

Mercurial Finance has 2 stablecoin pools. The good thing about Mercurial Finance is users are not required to provide liquidity to all the tokens existing in the pool. Users can choose to provide just one, or two, or all of the tokens to join the pool. In this article, we chose UST-3Pool, which includes USDC, USDT, and wUST, as the one to provide liquidity and we only provided USDC and USDT as liquidity.

Step 1: Choose the pool users would like to join and click Deposit.

Step 2: Insert the amounts of stablecoins users would like to provide. In this article, we provided 3 USDC, 2 USDT and 0 wUST.

Step 3: Click Deposit and then Confirm Deposit to proceed.

Step 4: Click Sign to let the transaction execute.

Step 5: Users will see the completed transaction on the displayed notification.

Removing Liquidity 

Step 1: Head to the Withdraw tab to start removing liquidity.

Step 2: It does not matter if users provided just one or more than one stablecoins before. At this step, users can choose to withdraw a balanced amount of each token or just a single token. 

• If users would like to withdraw a balanced amount of each token, click the Balanced button.
• If users would like to withdraw all the provided liquidity as a single token, click the Single token button, then click USDT dropdown to choose the token users would like to withdraw.

Step 3: Choose the percentage of liquidity users would like to withdraw, then click Withdraw.

Step 4: Click Confirm Withdraw.

Step 5: Click on Sign to allow the transaction to go through, and users will see the completed transaction on the displayed notification at the bottom left of the trading screen.

Wormhole

Wormhole is a bidirectional, decentralized token bridge between Ethereum and Solana. 

To maximize as well as keep users from hassles of moving stablecoins around, Mercurial Finance integrated Wormhole features into its trading. Using Wormhole, users, projects, and communities can easily move not only their stablecoins but also any tokenized assets between Ethereum and Solana to benefit from Solana’s high speed and low cost.

Details on how to use Wormhole can be found at this website: www.wormholebridge.com.

Rewards

MER holders also can be entitled to some rewards. Currently, MER have 2 sets of claimable rewards:

• "Day 1 Merc" NFTs For Devnet review and SOL+MER winners
• Community rewards for  Beta LPs for helping to bootstrap liquidity

Heading to mercurial.finance/rewards and connecting wallet and socials, users will see the list they can claim! Anyone can now link their wallet/twitter/discord to see and claim any community rewards they have without having to share their info publicly.

FAQ with Mercurial Finance

Are SOL tokens needed for the gas fees when trading?

Yes, to swap stablecoins on Mercurial Finance, users must have some Solana tokens (SOL) as gas fee. Users can buy Solana on a centralized exchange such as Binance and send them to the Sollet wallet.

How much is the LP fee?

The fee is minimal - 0.22%.

What are APYs of available pools currently in general?

Mercurial is having 2 pools right now: UST-3Pool and PAI-3Pool. Their APYs roughly are around 24.25% and 20.60%. Those APYs are subject to change in the future.

What advantage does building on Solana give to Mercurial Finance compared to competitors who build on other chains?

Due to Solana’s 65,000 TPS, super-fast settlement, and extremely low cost, Mercurial’s vaults will be able to execute transactions instantaneously at very little cost to the protocol.

What is the “dynamism” that Mercurial vaults count?

Mercurial Finance implements dynamic fees and vaults to greatly improve the profit potential for users.

• Dynamic Vaults: Mercurial Finance plans to enable the deployment of pooled assets to yield generating opportunities across the Solana ecosystem.
• Dynamic Fees: increase fees when market volatility is high to compensate LPs, while decreasing fees when market volatility is low to encourage trading.

Summary

Long term, Mercurial Finance aims to attract a large number of liquidity providers and maintain a market leader position among AMMs, while leveraging the power of Solana to drive the evolution of decentralized finance (DeFi). It is exciting to see new updates as well as features of the protocol in the future!

If there are any questions, please feel free to comment below for further discussions.