M$G 5 is a technical MVP for `MG5`, a reserve-token protocol designed for a future EVM AppChain deployment. The model tracks stable real-world monetary assets, including Gold and major fiat-equivalent sleeves, through a basket NAV and a strictly controlled stable mathematical mean. The current work is deliberately narrow: prove the Monetary logic locally with Solidity, Foundry, mocked reserves, mocked prices, haircuts, circuit breakers and stress tests before introducing validators, bridges, custody or mainnet exposure.
The M&G5 Global Reserve Protocol is a research and engineering project for a basket-backed reserve token. The protocol objective is simple: if a unit of MG5 is issued, the system must be able to explain what supports it, how its Monetary basket NAV is calculated, how Gold and fiat-equivalent exposures contribute to the stable mean, what happens when reserves are stressed, and why unsafe redemptions are not allowed to silently damage remaining holders.
The first MVP is not a sale, a public launch, a production stablecoin, or a real reserve product. It is a local protocol implementation intended to answer one question before anything else: does the monetary logic survive stress when confidence is removed from the model?
The core protocol architecture is designed for Monetary resilience. M$G 5 models stable real-world assets, including Gold and fiat-equivalent indices, through a basket-backed reserve framework that continuously measures NAV, collateral ratio, reserve haircuts and redemption safety around a stable mathematical mean.
The protocol checks that minting is not paused, the oracle is fresh and unfrozen, applies the mint fee, calculates MG5 output, and refuses the transaction if post-mint collateralization would fall below the target ratio.
Immediate redemption uses the current NAV, applies a redemption fee, checks slippage and tests the post-redemption collateral ratio. If the result would break minimum solvency, the immediate path reverts.
Queued requests escrow MG5. A keeper can process them only when burning the escrowed MG5 and reducing mocked reserves does not violate the minimum collateral rule.
USD, EUR, GOLD, CNY and BRICK/EM sleeves carry different haircut assumptions. The system uses haircut-adjusted reserves, not raw optimistic reserve value, when checking liabilities.
A stale or frozen oracle prevents minting and redemption execution. The system cannot rely on a stale NAV while continuing to issue or redeem MG5.
MGS is only a simulated bounty reward token in v0. It does not collateralize MG5, does not defend the peg and does not receive real yield. This avoids reflexive collateral mechanics.
The breaker layer can respond to stale or frozen oracle state, low collateral ratio, oversized redemption queue and manual emergency conditions. Minting is blocked first; queued redemptions remain possible only if solvency allows.
DEX liquidity / external market liquidity. Mocked in v0, reserved for immediate liquidity modeling.
Fee buffer. Accumulates mint and redemption fees as a protocol buffer.
War chest. Mocked emergency liquidity with a daily draw cap.
Reserve liquidation. Modeled as reserve liquidation capacity in v0.
Redemption queue. Explicit fallback when immediate redemption would be unsafe.
Circuit breaker. Final defensive state when objective failure conditions require throttling.
| Area | What is tested | Reason |
|---|---|---|
| Tokens | MG5 restricted mint/burn, MGS deployment and MGS-only bounty rewards. | Prevents public minting and prevents MGS from becoming reflexive MG5 collateral. |
| Oracle | Valid updates, zero price rejection, NAV calculation, freeze and staleness blocking. | Prevents NAV-dependent actions from executing on invalid price state. |
| Reserves | Mock reserve updates, haircut updates, adjusted reserve value and collateral ratio. | Makes solvency dependent on conservative reserve value, not raw nominal balances. |
| Mint/Redeem | Healthy minting, fee buffer, healthy redemption, undercollateralized mint rejection and queue fallback. | Ensures issuance and redemption preserve required collateral thresholds. |
| Stress | 20% and 40% redemption runs, oracle freeze, sleeve price shocks, haircut increases and buffer depletion. | Tests the protocol under conditions where confidence alone would not be enough. |
There is no custody account, no tokenized gold, no fiat rail and no reserve attestation in this phase.
Oracle behavior is implemented to test stale, frozen and shocked price conditions before production integration.
Cross-chain movement is not part of the first MVP because it does not prove reserve solvency.
The first milestone is monetary logic and stress behavior, not validator set design.
ProtocolGovernor uses role-based administration for local testing. DAO governance is not implemented.
The protocol does not market return, interest, yield or profit. The engineering priority is redemption integrity.
Build and test the monetary logic locally with mocked reserves and prices.
Move the same protocol contracts into a controlled EVM network environment.
Evaluate sovereign infrastructure only after the protocol logic passes stress tests.
Define security, operational controls and governance boundaries for a dedicated chain.
Design cross-chain movement only after reserve and redemption mechanics are mature.
Replace mock inputs with verifiable external data and independent reserve reporting.
Define the operational and legal structure required for real assets and real redemption.
Expose the protocol to adversarial testing before any capped production beta.
Only after monetary logic, infrastructure, custody, oracle and legal controls are defensible.