DeFi cryptocurrency Mutuum Finance has launched its V1 protocol on the Sepolia testnet, introducing the core mechanics of its lending and borrowing system. The team also said that development will continue and additional features will be rolled out next week.
Mutuum Finance protocol upgrade
In a recent statement published on X, the team confirmed that they are working on several upcoming features while improving key components of the codebase, including stability factor optimizations. According to the update, new protocol features will be released next week.
The project has raised over $20.6 million to date and has over 19,000 holders of the MUTM token, currently priced at $0.04. In the same update, the team noted that Sepolia’s testnet version of the lending and borrowing protocol exceeded $90 million in testnet total value locked (TVL), reflecting simulated liquidity activity during beta testing.
Lending and borrowing with Mutuum Finance
The current beta version allows users to interact with the core functionality of the protocol. The interface displays an overview of the protocol, including total liquidity, available liquidity, and total variable liability. Currently, four assets are supported for mint interaction on the testnet: ETH, USDT, LINK, and WBTC. The portfolio section provides data on net worth, net APY, stability factor, total supply and borrowing balances, and mtTokens has also been integrated into the current version of the platform.
When a user contributes an asset to the platform, they receive the corresponding mtToken as proof of deposit. For example, supplying WBTC will generate mtWBTC. These tokens accrue value over time based on the applicable APY, determined by pool utilization.
By depositing $10,000 worth of USDT into the protocol, users will receive mtUSDT in return. At an average annual yield (APY) of approximately 4-5% per year, this position could generate approximately $400-500 in passive income, depending on pool utilization and borrowing demand. Additionally, users can stake mtToken within the secure module and eligible participants will receive dividends denominated in MUTM tokens.
On the borrowing side, collateral is required to secure the loan and protect the protocol from the risk of default. Rather than selling assets, users can pledge their assets as collateral and borrow according to their value. For example, an investor who holds $1,000 worth of ETH and does not want to liquidate his position can deposit that ETH as collateral and borrow USDT. While borrowed stablecoins can be used for expenses or deployed into other investments, users remain exposed to the potential appreciation risk of ETH. Once you have repaid the loan amount and accrued interest, you can withdraw your collateral in full.
Audited protocols
Mutuum Finance has undergone a security audit of its lending and borrowing protocols conducted by Halborn, a blockchain security firm that has also audited major projects such as Solana. Additionally, the MUTM token smart contract was reviewed by CertiK and received a token scan score of 90 out of 100.
Mutuum Finance has partnered with CertiK to establish a bug bounty program with a reward pool of up to $50,000, aimed at identifying potential vulnerabilities and strengthening the security of the protocol.
The total supply of MUTM is limited to 4 billion tokens. A portion of this allocation will be allocated to incentives such as giveaways, leaderboard bonuses, and other community rewards programs.
Mutuum Finance continues to advance the development of its lending and borrowing protocols as testing progresses on the Sepolia network. With additional features scheduled to roll out and security reviews completed, the project remains focused on refining the infrastructure prior to full deployment.
