Data maxima venia
alETH v1 vault with 400% collateralization and low APY of 3-4% is a less-than-optimal product and I think we all know it.
If I deposited my ETH on any Alchemix vault today, I expect it to be on par with the best yields available on DeFi.
stETHcrv is rewarding 11,44% APY -- if we can't match that, no matter the collateralization settings debate, I don't think it's worth launching.
By Alchemix launching this iteration I don't see any angle that this would benefit the community, au contraire, I can see it only tarnishing it's pristine branding.
Consider that Alchemix is already a very hard to grasp concept for the average user.
We (I mean you guys) are working very hard to educate users and present the benefits of utilizing ALCX vaults.
Even amidst all the confusion happening in normies and no-coiners minds, in my perspective, there are certain aspects about the actual v1 DAI vault that allure as crucial concepts of Alchemix (as a service provider), in simple terms:
- user deposit X (100%) -> user can borrow X/2 (50%) upfront
- meanwhile, 100% of deposited amount is kept "working" in DeFi
- loan pays itself as fast as DeFingly possible
I think those are more than settings. To me they are fundamental characteristics and a piece of the branding concept of Alchemix. This is already being memefied amongst the web. I don't think we should give up on them in favor of shipping a v1 ETH vault fast.
In my view the launch of alETH with low APY and higher collateralization would only contribute to further confusion and unhappy users. Or even worse, the market could dislike it at large and label us as a flop, or a one-time product company.
If we decide to launch vaults with superior collateralizations and lower than best APY's, the end user will get further confused and letdown.
This may be worth doing in certain cases, like with alBTC maybe. I don't think this is the case for alETH at all.
I would rather delay the launch and consider stETHcrv for higher APY or forget about it entirely and focus on V2 where we could chase better yields wherever they are. Last not forget that ETH has EIP-1559 and the merge are happening soon, and with this, ETH as an asset is expected to deliver much higher yields and those should be harnessed by our vaults.
Also, if the APY (on launch) of any vault is higher than 10%, I would not consider changing the collateralization ratio (would keep 200%). If the APY by any chance lowers after launch then the user can always self-liquidate to retrieve its principal.
Although I think it is prudent to keep alETH mintable ceiling low and increase it slowly (as it is already being proposed.)
TL;DR - postpone alETH vault in favor of higher APY chasing (with stETHcrv or wait for V2)