Minting & Redeeming
The main mechanism for maintaining 1:1 peg
In order to mint one unit of FTMz, the Zest Protocol requires 1 FTM. The Zest Protocol then converts this FTM into FTMz based on the collateral ratio at the time of minting.
When a user Redeems their FTMz for FTM, the Zest Protocol will return FTM & (1-Collateral Ratio) worth of ZSP.
There is a 0.3% fee for minting and 0.5% fee for redeeming, that is transferred to ZSP holders in the form of staking and locking rewards.
The minting or redeeming fee is calculated using the following formula, where fee (f) is either 0.3% or 0.5% depending if the user is minting or redeeming FTMz.