[Mountain Protocol] LTIPP Application - FINAL


Applicant Name: Jason Mindlin

Project Name: Mountain Protocol

Project Description: Mountain Protocol USD (USDM) is the first regulated permissionless yield-bearing stablecoin, backed by US Treasuries.

Mountain Protocol is a regulated entity by the Bermuda Monetary Authority (license #202302512).

Main Team Members and Roles

Martin Carrica - Chief Executive Officer

Matias Caricato - Chief Technology Officer & Chief Information Security Officer

Firas Nadim Habach - Board Member

Erika Gonzalez - Chief Compliance & Risk Officer and MLRO

Jason Mindlin - Chief of Staff

Project Links

Website: https://mountainprotocol.com/

X: https://twitter.com/MountainUSDM

GitHub: Mountain Protocol · GitHub

LinkedIn: Mountain Protocol | LinkedIn

Independent risk assessments:

  • BlueChip: link
  • Steakhouse Financial: link

Contact Information

Point of Contact: @jason_usdm

Point of Contact’s TG handle: @jasonmindlin

Twitter: @jason_usdm

Email: jason@mountainprotocol.com

Do you acknowledge that your team will be subject to a KYC requirement?: Yes.

SECTION 2a: Team and Product Information

Team experience

Matias Caricato

Founder and CTO of the Company. Experienced tech leader with 10+ years in the software industry. Extensive CeFi experience, most recently building and scaling, in the role of CTO, the largest CeFi exchange in Argentina with 1M+ users and 100M+ in TVL.

Martin Carrica

Founder and CEO of the Company. Experienced finance leader, launching new banking products across geographies (Latam & USA) in both Retail and Commercial verticals, as part of McKinsey and in personal capacity. Extensive experience on banking risk including conceptual Basel III implementations and practical bank receiverships.

What novelty or innovation does your product bring to Arbitrum?

USDM is the only permissionless and regulated yield-bearing stablecoin, bascked by U.S. Treasuries.

Yield bearing USD stables have a similar impact to Ethereum Liquid Staking tokens, allowing more of the value of the assets to stay within the ecosystem.

Mountain Protocol is a prudentially regulated financial institution under the Bermuda Monetary Authority, a leading crypto regulator and established financial regulator, representing over 1/3rd of the global re-insurance market.

Is your project composable with other projects on Arbitrum? If so, please explain:

USDM is a permissionless ERC20 and can be used by any protocol. For example, USDM will be used by IPOR as collateral for their SOFR interest rate swap product, to be launched on Arbitrum, becoming the most voted proposal on IPOR (link).

Do you have any comparable protocols within the Arbitrum ecosystem or other blockchains?

There are many stablecoins in Arbitrum, but none are yield bearing for the users. Some issuers keep the yield themselves, other pass it over to intermediaries, but none reward the actual holders. In our opinion, this is the fairest model.

How do you measure and think about retention internally? (metrics, target KPIs)

Success metrics for USDM are related to usage of USDM, which grows with assets held (TVL) as well as transactional volume.

The team monitors non-DeFi USDM as an important leading indicator of stickiness: USDM held on EOA is not earning any additional incentives. All healthy assets such as USDC, ETH, stETH, have a sizable portion of EOA/CeFi holdings.

See chart: https://dune.com/steakhouse/stablecoins

Relevant usage metrics - Please refer to the OBL relevant metrics chart. For your category (DEX, lending, gaming, etc) please provide a list of all respective metrics as well as all metrics in the general section:

  • USDM held on EOAs (as proxy for missionary holders)
  • USDM held in DeFi protocols on Arbitrum, broken by usage (Lending, Perp, DEX)
  • Number of USDM holders
  • Volume transacted with USDM

Do you agree to remove team-controlled wallets from all milestone metrics AND exclude team-controlled wallets from any incentives included in your plan


Did you utilize a grants consultant or other third party not named as a grantee to draft this proposal?:



Is the protocol native to Arbitrum?:

No, it was first deployed on Ethereum Mainnet and deployed on Arbitrum afterwards. $1.00 | Mountain Protocol USD (USDM) Token Tracker | Arbiscan

On what other networks is the protocol deployed?:


What date did you deploy on Arbitrum mainnet?:

Technical deployment on November 17th, 2023, with regulatory approval recently received.
Contract creation: Arbitrum Transaction Hash (Txhash) Details | Arbiscan

Do you have a native token?

USDM is natively issued on Arbitrum. Aside from product tokens, Mountain Protocol does not have a token. For more details on USDM token functionality, visit: USDM Token - Mountain Protocol

Past Incentivization: What liquidity mining/incentive programs, if any, have you previously run? Please share results and dashboards, as applicable


Current Incentivization: How are you currently incentivizing your protocol?

We are currently providing rewards for a sDAI/USDM pool on Curve on the Ethereum Mainnet, spending ~10k/month for a further +3.5% APR.

Have you received a grant from the DAO, Foundation, or any Arbitrum ecosystem related program?

Yes, we have received:

(1) a USD 25k grant to launch USDM on Arbitrum, of which USD 15k have been already sent to Mountain Protocol.

(2) a ARB 50k grant to deploy and grow USDM on Arbitrum, of which ARB 10k have been already sent to Mountain Protocol.

Protocol Performance

Mountain Protocol’s USDM is the largest yield-bearing stablecoin backed by T-bills, with $150M+ in TVL.

Source: https://dune.com/steakhouse/tokenized-securities

Source: https://defillama.com/protocol/mountain-protocol

Protocol Roadmap:

Mountain Protocol’s roadmap is focused on establishing ourselves as leaders in the Real World Asset (RWA) category and capturing a substantial share of the stablecoin market. We will achieve this through strategic partnerships, user acquisition campaigns and ongoing product development efforts aimed at enhancing the usability and adoption of USDM. Our upcoming native bridging feature, scheduled for launch by mid-2024, will significantly enhance the interoperability and utility of USDM across different blockchain ecosystems.

Audit History & Security Vendors

We have run two security audits (one for USDM and one for wUSDM), conducted by OpenZeppelin: GitHub - mountainprotocol/audits: Mountain Protocol Code Audit Reports

We have a bug bounty program, live on Immunefy: Mountain Protocol Bug Bounties | Immunefi

Mountain Protocol maintains robust security levels, including regular security audits, continuous monitoring for vulnerabilities, and the implementation of best practices in the industry to safeguard user assets and data. We also carry out a quarterly vendor assessment, reviewing their compliance with regulatory requirements, the maturity of their security information and any reputational incidents.

All important security information can be found at the Security Center: https://security.mountainprotocol.com/

Security Incidents



Requested Grant Size:

ARB 295,000

Justification for the size of the grant:

With a target ~$18M TVL on Arbitrum at the end of the grant period, a ~590k grant represents a ~3.3% TVL acquisition cost, ~60% lower than the cost of STIP 1.

As benchmark, STIP Round 1 had a 8.3% TVL growth cost ($600M TVL growth of grantees on $50M grant). Note that the TVL could have grown by price increases, while ARB price is accounted at the Nov 1 price of ~$1/ARB.

Grant Matching:


Grant Breakdown:

# Initiative Description Protocol(s) / Partner(s) Requested amount
1 USDM/USDC pool AMM for zapping in/out Camelot or similar ARB 100,000
2 wUSDM/wstETH pool AMM with native APY, increasing self-sustainability. Camelot or similar ARB 120,000
3 DeFi partner integrations Bootstrap liquidity with sustainable use cases IPOR, Poolside, other ARB 75,000
Total ARB 295,000

Funding Address


Funding Address Characteristics:

The funding address is a 2/3 multisig on Safe.

Treasury Address:


Contract Address:




The primary objective of the grant program is to introduce and bootstrap USDM, the largest yield-bearing stablecoin, into Arbitrum, the premier DeFi ecosystem.

This initiative seeks to establish sustainable use cases that will thrive beyond the initial incentive phase, emphasizing the attraction of stable, long-term capital.

In practice this could represent $25M in USDM TVL on Arbitrum, driven by the entry of large institutional players and a widespread adoption across major Arbitrum protocols,.

Execution Strategy:

1 - AMM liquidity (USDC/USDM pool)

Provide additional incentives for USDM/USDC pool.

Pool natively provides 2.5% APY (5% APY * 50% of USDM).

Targeting a 14% APY, the incentives should provide an additional 11.5%, until trading fees grow as usage kicks in.

Base scenario: 100k ARB * $2/ARB * 52 weeks / 12 weeks / 11.5% increase = ~7.5M TVL
Fees to be adjusted to match market conditions

2 - AMM liquidity (wstETH/wUSDM pool)

The largest pool in most chains is the ETH to stablecoin pool, usually USDC/wETH.

With the advent of yield-bearing assets like stETH and USDM, more sustainable AMMs can be built, which carry native yield.

AMM LPs make money by (a) native yield, (b) swap fees and (c) incentives, and have expenses related to (d) impermanent loss, (e) operational cost and (f) smart contract risk.

By providing a native yield of 4.25% (3.4% from stETH and 5% from USDM), LP returns can grow from ~15% to ~20%, a 25% increase.

This use case should be self-sustainable once bootstrapped, and provides a better venue for LPs to trade in, as well as lower spreads for swappers, which is required for DeFi.

Since there are USDM-USDC and wstETH/wETH pairs, bootstrapping volume should be simpler in this pool.

120k ARB *2$/ARB *52 weeks / 12 weeks / 14% incentives = ~7.5M TVL for 12 months
Fees to be adjusted to match market conditions

3 - DeFi Partner integrations

USDM, as a natively yield-bearing asset, is set to be a fundamental component of DeFi, similar to how yield-bearing assets are utilized in TradFi. We look forward to forming valuable partnerships with protocols that offer significant utility and practical applications to users; any excess funds that cannot be allocated to such kind of protocols will be returned to the Arbitrum foundation.


In order to build SOFR swaps on-chain, IPOR will leverage USDM as the collateral vault. This significantly reduces the costs as the collateral rewards provide returns in addition to the fees collected. This was the most voted proposal on IPOR (link).

We intend to co-incentivize USDM swap usage along with the IPOR team.


Poolside is an AMM that supports rebasing tokens, a feature that most AMMs do not. This protocol’s growth could help in the overall acceptance of USDM, as it is easier to use than the wUSDM version.

We intend to co-incentivize a USDM/USDT pool along with the Poolside team.


We expect to partner with other use cases, such as:

  • Insurance protocols that look to store assets in escrow in safe yield-bearing assets
  • FOREX: similar to the USDM/stETH pool. In particular, Euro yield-bearing stables
  • Any other innovative financial applications

What mechanisms within the incentive design will you implement to incentivize “stickiness” whether it be users, liquidity or some other targeted metric?

All of the above use cases are meant to bootstrap use cases that are sustainable with no additional incentives once bootstrapped.

We also believe that more projects will begin to utilize USDM as a way to provide better returns to their users and reduce the returns drained by non-yield bearing stablecoin issuers.

Also, we will approach Institutional players to engage with USDM on Arbitrun. Institutional integrations offer the potential for longer-lasting users:

  • Institutional partners, like CEXs, are less likely to change strategies since they manage users’ funds, making them more risk-averse.
  • Being featured on a CEX provides valuable shelf space, reducing customer acquisition costs per natural user inflow/outflow.

Specify the KPIs that will be used to measure success in achieving the grant objectives and designate a source of truth for governance to use to verify accuracy. [Please also justify why these specific KPIs will indicate that the grant has met its objective. Distribution of the grant itself should not be one of the KPIs.]

Main KPIs to be tracked:

  • USDM held on EOAs (as proxy for missionary holders)
  • USDM held in DeFi protocols on Arbitrum, broken by usage (Lending, Perp, DEX)
  • Number of USDM holders
  • Volume transacted with USDM

To be presented on a Dune Dashboard

Grant Timeline and Milestones: [Describe the timeline for the grant, including ideal milestones with respective KPIs. Include at least one milestone that shows progress en route to a final outcome. Please justify the feasibility of these milestones.]

# Initiative Requested amount Timeline / Milestones
1 USDM/USDC pool ARB 100,000 3 months at a $7.5M TVL
2 wUSDM/wstETH pool ARB 120,000 3 months at a $7.5M TVL
3 DeFi partner integrations ARB 75,000 3 months at a $3M TVL
Total ARB 295,000

How will receiving a grant enable you to foster growth or innovation within the Arbitrum ecosystem? [Clearly explain how the inputs of your program justify the expected benefits to the DAO. Be very clear and tangible, and you must back up your claims with data]

This grant will strengthen both USDM and Arbitrum within the DeFi landscape. Having yield-bearing stablecoins with organic use cases will fortify Arbitrum’s ecosystem and continue to build its DeFi leadership.

USDM is the leader in yield-bearing stablecoins and its regulated and tried-and-true structuring allow for a trusted asset that rewards holders. Arbitrum’s focus on DeFi is the natural first L2 for DeFi innovation on top of USDM to happen.

By having a robust yield-bearing stablecoin ecosystem, Arbitrum will cement its position as the go-to network for institutions within DeFi.

Do you accept the funding of your grant streamed linearly for the duration of your grant proposal, and that the multisig holds the power to halt your stream?


SECTION 5: Data and Reporting

Is your team prepared to comply with OBL’s data requirements for the entire life of the program and three months following and then handoff to the Arbitrum DAO? Are there any special requests/considerations that should be considered?

Yes. The team reports monthly to regulators and other counterparties as part of being a regulated financial institution. As such, the team is prepared for this requirement.

Does your team agree to provide bi-weekly program updates on the Arbitrum Forum thread that reference your OBL dashboard? [Please describe your strategy and capabilities for data/reporting]


Strategy involves a direct DRI responsible for carrying out the update, with direct supervision of the CEO. Deadlines are calendarized to ensure we provide the reports in a timely manner.
The team will create a Dune dashboard to keep track of all relevant metrics and add specific observations when relevant.

Does your team agree to provide a final closeout report not later than two weeks from the ending date of your program? This report should include summaries of work completed, final cost structure, whether any funds were returned, and any lessons the grantee feels came out of this grant. Where applicable, be sure to include final estimates of acquisition costs of any users, developers, or assets onboarded to Arbitrum chains. (NOTE: No future grants from this program can be given until a closeout report is provided.)


Does your team acknowledge that failure to comply with any of the above requests can result in the halting of the program’s funding stream?:


1 Like

Hello @jason_usdm

Thank you for your application! We can confirm your application has been submitted and you will be assigned an advisor shortly.

Hello @jason_usdm ,

Thank you for your application! Your advisor will be @JoJo.

Please join the LTIPP discord and ping your advisor in the general chat so they can create a new channel and start communicating with you.

@cliffton.eth @raam please switch name to FINAL

Hey there, I’ve amended the proposal title to reflect that this is FINAL. All the best!

1 Like

Thank you for the proposal. Although it is expected that 25M USDM in TVL will come to Arbitrum based on the requested grant amount, considering that the project’s total TVL is $80M, we are unsure whether the grant is intended to benefit the Arbitrum ecosystem or primarily Mountain Protocol. Additionally, we couldn’t find an explanation for why the TVL of $150M shown during the proposal preparation later dropped to $80M in an inorganic manner.

Due to these reasons, we are casting our vote as Abstain.