Machina Labs
3 min readMar 15, 2021

Introducing yUMA21, the Yield Dollar UMA for 2021.

Today we are launching UMANJI, the first platform to allow users to mint yUMA21 using UMA as collateral.

yUMA21 is a Yield Dollar, you can see it as a stablecoin but there are some important differences:

  • It is only valid for the current year
  • As the expiration date approaches, its price will be close to $1
  • When it expires, it will be redeemable for $1 of the collateral asset

What can you do with yUMA21?

Increase UMA exposure

Let’s say you believe the UMA price will go up, with UMANJI you can mint yUMA21, sell it for USDC and buy more UMA, increasing your exposure to it.

You can see yUMA21 as a fixed-rate, fixed-term loan.

For example.

Alice has 1000 $UMA

She goes to UMANJI and lock her 1000 $UMA to mint 10,000 yUMA21.

Let’s say the price of yUMA21 is $0.96 and the UMA token is worth $ 23.

Then, she swaps 10,000 yUMA21 → 9,600 USDC → ~417.39 $UMA

Increasing her exposure

Now, on the 31 of December, let’s say the price of UMA is $ 30.

She could sell the 417.39 UMA and get 12, 510 USDC, pay back her loan and earn 2,910 USDC of UMA.

Another approach would be to simply continue holding $UMA and pay back the loan on the 31th of December with extra funds.

As the price of yUMA21 would be close to $ 1 on the expiration day, it means she will have to pay 10,000 USDC for the 10,000 yUMA21 she minted before. In other words, that’s a 4% fixed interest rate loan !

Liquidity mining

You can also add liquidity to the Uniswap pool and earn $UMA for doing so.

UMANJI is part of the UMA developer mining program and based on the total value locked in the platform, we will receive a proportional amount of the total 50,000 $UMA that the UMA protocol is giving away every week to participating apps.

At the current state the following table illustrates the possible rewards.

The UMANJI platform will give 80% of the Liquidity mining program rewards to its liquidity providers plus LP rewards from Uniswap.

We can see that for every 64 - 84 UMA tokens provided to UMANJI every liquidity provider can receive 1 UMA token per week till the end of the year. Note that this is considering the price of UMA at $ 25, which means that once the UMA price increases you can earn more $UMA per week.


How to increase exposure

  1. Mint yUMA21.

Go to the dashboard and click Create position

Mint (Approve if you need to)

Swap yUMA21 to UMA

Go to Uniswap and Swap

Note: You might want to add the token a token list by clicking manage or simply past the token address


How to add liquidity

  1. Mint yUMA21 (As in the step before)
  2. Add Liquidity to the Uniswap Pool

Click Add Liquidity

Add yUMA21 and USDC to the pool

And that is all !