Introduction
Modules
Resources
modules
The Role of PSM
PSM is the economic glue of Possum Finance and functionally interconnects Signal Vaults and Asset Vaults via positive feedback loops.
To participate in the no-loss prediction markets, users must stake PSM in a Signal Vault. The epoch rewards are paid in PSM. The Signal Vault takes a 1% deposit fee to prevent manipulation attempts of the signal. This fee is used to automatically increase the PSM/ETH liquidity on Uniswap V2.
More stakers → more demand → more liquidity.
Assets from the Asset Vaults can be withdrawn in exchange for PSM. This refills epoch rewards for stakers. Consequently, the value of PSM is linked to the value of assets in the Vaults which establishes an elastic floor price.