[Temp Check] Upgrade Bonding by Creating Direct ETH and DAI Bonds

ov3rkoalafied

The only thing I'd like to add is that because the pool is usually weighted more towards alAssets than the base asset, even depositing at a 50/50 ratio would help restore the peg. Plus it takes a lot of imbalance to put a matched-value asset pool off peg, so we would rarely if ever have to deploy 100% ETH/DAI depositing.

So basically you're a genius and this is a win all around. Yields are gonna be so juicy. Thanks for spearheading this!

0xFelix

I've liked this idea ever since it was brought up the first time. My only concern were the comments made by the Olympus team originally on bonding straight-up ETH/DAI, but from the discussion today I understand there are no technical/policy difficulties in setting this up. So in that case it's clear that this approach would offer us more flexibility plus a lot of benefits in terms of boosting yield and maintaining the pegs.

yuntamoto

0xFelix Thanks for mentioning this. For the sake of reference, could you share the comments made by the Olympus team on bonding straight-up ETH/DAI?

I like this idea a lot, from what I'm hearing. But I'm also tone deaf 🙂

LyleSlymon

Would taking LP tokens encourage faster conversion of liquidity from non-protocol-owned to protocol-owned? I suspect taking single assets would add protocol-owned liquidity, but would create a small barrier to entry for those already holding the LP tokens.

ButlerAndTheThirdStringers

LyleSlymon Unlike the current ALCX/ETH bonds I would think that a lot of people holding the LP positions for the mirror assets desire either full exposure to the price of ETH or full exposure to the price of DAI. Some of these users may not even care for ALCX exposure and have no intention of bonding as a result. You are correct that in cases these LP holders do want to bond then this would require those users to instead bond with ETH or DAI directly, but overall I think it would make bonding much more appealing to a larger set of people, who would now be able to simply buy ALCX at a discount using DAI or ETH instead of having to do the math on whether or not it's worth it to pay the gas to create the LP while also factoring in how much yield they're forgoing for the week long vesting period. I definitely think that bonding ETH and DAI directly would result in the creation of protocol owned liquidity on a much larger scale and at a much faster rate than bonding LPs for mirror assets.

Jankes

Great proposal. As my previous degen-friend said it is win-win. It will by easier to bond just ETH and DAI because of the gas costs. Larger community of Alchemix can be involved to buy bonds and help the protocol grow. Yield will be juuuuuuicy 🙂

0xsublime

Yet another benefit of this is that it speeds up transmutation, essentially strengthening the peg. The protocol is taking the opposite position as the users using the Transmuter. Win-win-win.

ov3rkoalafied

yuntamoto All I really know is that Scoopy discussed this proposal with them and they said they were OK with it. As I understand it the variables are a bit more sensitive but it's something they've done before, so we're not the first to try this.

reginald-grarbs

I would buy these bonds. I love the idea of giving the protocol more control over it's own destiny, boosting yields, using the assets to balance the peg or simply control more liquidity. I don't really see any downside to this since scoopy mentioned that it shouldn't be too difficult to add the functionality.

jerre

This is a genius proposal! Absolutely love it! Hero @ButlerAndTheThirdStringers

Ps: will this process be automated fully (from DAI / ETH -> To LP positions) or will the team have to do that manually?

ov3rkoalafied

jerre It would likely be manual at first, just like staking the protocol owned LP is right now. In the future it could be automated (I believe scoopy said it would be pretty simple to automate, so likely some time shortly after V2 when devs free up they could write that code rather quickly)

hekmat

Another proposal I don't see any downside with. Either the added funds to the transmuter OR the simplification of the bonding process for non-SLPers would be reason enough to push this through IMO.

In conjunction it feels like an easy decision.

hekmat

ButlerAndTheThirdStringers

Thinking about it some more, and recognizing I'll probably be in the minority here, I would MUCH rather have ETH & CVX bonds than ETH & DAI if i had to choose two... At the very least I think CVX should be included when we add single-asset bonds (If possible) ETH/CVX/DAI.

Consider that CVX bribes, since September 27th, have increased from $200kish - > $4.5~ million. It does seem that more protocols are going to be looking Convex's way and the majority of CVX supply could end up pseudo-locked across various DAOs (similar to how CRV supply is mostly locked between Convex and Yearn IIRC)

DAI's only real advantage is some temporary stability in the event of a crypto-market crash (Or a Convex-specific implosion to be fair). I'd argue that the utility of owning CVX is at least as strong as DAI.

Worth considering at least IMO.

Edit: I guess there'd be less user demand for a CVX bond, which is a fair critique.