Read time: 3 minutesSeptember 12, 2022

Trade the Merge with Mycelium’s Fee-Free Spree

In celebration of the ETH merge, leveraged trading is fee-free!Trade the Merge with Mycelium’s Fee-Free Spree

In celebration of the ETH merge, we are going Fee-Free! We’ve dropped the entry/exit fees on leveraged trading until the Ethereum Merge.

Trade with liquidity, leverage, NO entry/exit fees, Trade with Mycelium.

Trade Now.

Margin trading on any asset (ETH, BTC, LINK, UNI, BAL, CRV, FXS) will incur ZERO entry/exit fees. Note that any spot swaps that occur will still be charged a fee.

The Ethereum Merge is scheduled for between September 13–15 2022, meaning traders can access 36–72 hours of fee-free trading on Mycelium Perpetual Swaps.

We’ve added a Merge countdown to our front-end so you can keep track here.

Risk mitigation for ETH merge

We have reason to believe that ETH prices on Arbitrum leading up to the merge will begin to dislocate from ETH prices on Mainnet. This is due to the fact that ETH on arbitrum is ineligible for any potential ETHPOW airdrops, while ETH on mainnet is eligible.

The likelihood of an ETHPOW airdrop can be backed by the fact that ETH futures are in backwardation, indicating a large amount of cash-and-carry traders aiming to be delta-neutral while also receiving any potential ETHPOW airdrops, and be delta-neutral to the price of ETH itself.

We believe that this could cause a mass sell-off of ETH to stables on Arbitrum, and the subsequent bridging of stables to mainnet. As such, we are going to implement a range of measures described below to protect MLP holders from significant ETH sell pressure up until the merge.

Potential Risks

Ahead of the Ethereum Merge, Mycelium may face market volatility due to the structural changes in ETH. To ensure the robustness of our platform, and in the interests of full transparency with our community of users we wanted to outline potential risks we’ve identified, and measures we’re enacting to manage those risks.

In line with the spirit of the Aave proposal here, we are going to introduce some preventative and precautionary measures prior the Merge to protect our LPs and maintain the integrity of our trading platform.

If you would like more information on The Merge, refer to official updates like this one from The Ethereum Foundation.

Measures in place on Mycelium Perpetual Swaps

The changes we will make to protect LPs and traders alike are:

  • Implement tight bounds on the pool assets so that the ETH composition of the pool tends towards its target. At this time, ETH has a target ratio of 25% of the overall liquidity pool. This can only vary 25% higher or lower than it’s target amount before swapping is paused in that direction. As such, ETH can only make up 31.25% of the pool at maximum, or 18.75% at minimum.
  • ETH now has a maximum global short size (notional value) of 1,000,000 USD. This is to prevent LPs from any sudden drop in the price of ETH due to the ETHPOW airdrop causing a decrease in ETH prices.
  • Increase spot swap fees to dis-incentivise spot-swap activity which over-exposes the Liquidity pool to ETH. The base spot swap fee will now be 0.30%, and will increase as it’s percentage of the pool increases.

Timelines for measures

These changes will commence indefinitely and will last (at least) until the end of the merge. The team will re-examine post-merge once more information is known. Further measures may be implemented as time progresses, and the Mycelium team will update users when measures are wound back to normal.

We’re taking proactive and precautionary measures to ensure the integrity of our platform for Traders and Liquidity Providers.

Traders can start trading fee-free now with Mycelium Perpetual Swaps.

Trade with liquidity, leverage, NO fees, trade with Mycelium.

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All of Mycelium’s products are hosted on Ethereum Layer 2, Arbitrum. Users will need to bridge their assets to Arbitrum in order to trade Perpetual Swaps, Perpetual Pools, or Lend via MYC Lending.

Arbitrum is a secure, low-cost scaling solution that ensures our users can access low-cost derivatives in a safe, simple, and speedy environment.

If you need assistance bridging your assets, our team has prepared a guide here.

Mycelium Perpetual Swaps is a decentralised derivative platform, which allows users to open leveraged long and/or short positions on crypto-assets.

Perpetual Swaps are similar to a Future where traders can take a position based on the future price of an asset, the key difference being Perpetual Swaps mechanisms allows traders to take this position at an unspecified point in the future, making it ‘perpetual’ or unable to expire. Mycelium Perpetual Swaps allows traders to take a position on digital assets such as Bitcoin and Ethereum.

Mycelium Perpetual Swaps doesn’t use an order book model for leveraged trading. Rather, all traders trade against the Mycelium Liquidity Pool (MLP). The MLP is a basket of blue-chip assets and stablecoins pooled together (ETH, BTC, LINK, UNI, BAL, CRV, FXS, FRAX, USDT, DAI, USDC) which acts as a global AMM for leveraged trading. Liquidity providers can deposit any whitelisted asset into the MLP pool in return for MLP tokens, which represent the LPs share in the diversified liquidity pool. By acting as a universal counterparty (AMM) to traders, meaning that it agrees to be the counterparty to any long or short trade at the given price, for an asset it holds, until it runs out of said asset.

In exchange for providing liquidity to the Mycelium Liquidity Pool (MLP), liquidity providers earn rewards. Primarily, MLP holders earn 70% of fees generated on the platform, which is distributed fortnightly in ETH and or esMYC.

  • ETH Rewards: The MLP pool earns 70% of fees generated from swaps and leveraged trading. These fees are converted to ETH, before being continuously distributed to MLP stakers.
  • Escrowed MYC Rewards: These are rewards in the form of a token which has the right to vest into $MYC when staked in the esMYC vesting vault.

The trading fees that make up this revenue are entry/exit fees, borrowing fees, and or a spot trading fees. For a full overview of the trading fees, visit this page.

Additionally, LPs earn rewards from a small bid/ask spread that is charged on long-tail assets (there is no spread on BTC or ETH). These rewards accrue as MLP, shown on our front-end as Market Making APR. These rewards can be redeemed at any time, in any asset form within the MLP basket of assets.

Yes. Perpetual Pools are a marketplace for leveraged tokens, while perpetual swaps simulate spot trading with margin. They are both derivatives, but Perpetual Pool tokens act most like a leveraged ETF, where positions are transferable.

Mycelium Staking is a program established by Mycelium to give utility to our governance token. MYC holders can stake their $MYC to earn ETH rewards. MYC Stakers effectively enter a loan agreement with the Mycelium Treasury to lend their MYC. The Loan Cycles occur fortnightly, meaning deposits and withdrawals are processed at the beginning/end of each cycle. Stakers can request withdrawals throughout the cycle, noting the withdrawal will be processed and distributed at the end of the cycle.

Don’t worry, you are earning rewards! The rewards only show at the end of the 14 day loan cycle.

The way the Perpetual Pool market calculates how much money to move from the losers to the winners prevents the loser from ever losing 100% of their money. The pool does this by, in extreme scenarios, sacrificing some of the gains of the winners in order to protect the losers from losing everything. This is why we say Perpetual Pool positions cannot be liquidated.

However; this does not mean you cannot lose money by trading with Perpetual Pools.

In August 2022, TracerDAO voted to transition and rebrand to core service provider Mycelium, and $MYC as the native token. All TCR holders are entitled to change their token 1:1 to MYC via this site:

The majority of TCR holders have migrated to MYC, but the site will remain active for approx. 3 years to ensure all TCR holders have the opportunity to migrate.

When a trader enters a short position, the liquidity pool will fully collateralise the position with stablecoins. For short positions, the liquidity pool is essentially a market maker that takes the opposite side of the position, increasing the long exposure of the pool. If the price of the base asset depreciates, the trader receives stablecoins from the liquidity pool. If the price of the base asset appreciates, the liquidity pool receives a portion of the user’s margin as compensation.

At close, the trader will only have to return the USD value of the initial notional value to the liquidity pool. Thus, the trader is effectively entitled to the inverse of the future “PnL” (Profit and Loss) of an asset.

With Perpetual Pools v2, users can deposit any sort of collateral for maximal optionality. Additionally, there is no minimum-commit size.

On Mycelium Perpetual Swaps traders can access up to 30x Leverage. On Mycelium Perpetual Pools traders can access up to 10x Leverage.

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