Add V2 supplier tokens as a V1 collateral option

Governance General
1

I want to propose introducing Lenfi V2 supplier tokens as a collateral option for V1 for a small group of assets intially.

Benefits
This would allow a situation where people longing a CNT or ADA are able to increase their yield by having their underlying collateral earning supplier APY. It would also assist in offering additional liquidity to V2 supplier without the need to remove their assets.

The main risk with this is if we were in a situation where a V1 loan back by V2 supplier collateral and the V2 supplier tokens are irredeemable due to high V2 UR. To mitigate this I would suggest initially applying this proposal for Lenfi, Snek and IAG based of V2 pool depth. We can ofcourse expand this in the future.

Do you support adding V2 supplier tokens as a V1 collateral option?
  • Yes
  • No
  • Abstain
0 voters
10 Likes
2

Also clarify this is to approve the CNT & ADA V2 supplier tokens for these pairs.

5 Likes
3

It would be great to clarify the proposal before the forum voting.

First, I believe it’s challenging to understand the proposal from reading the description.

Secondly, we should reconsider if we want to include a non-collateral asset (e.g., MELD) as collateral in V1, just because it’s deposited as liquidity in V2. The same asset remains as volatile as the original, with additional risks attached.

Moreover, we should explicitly state the introduced risks. A lender might receive compensation in a collateral asset that cannot be claimed in any way. This occurs in cases where the Utilization Rate (UR) is as high as 98%. Users would receive LP tokens that do not represent actual token value.

I personally believe it’s acceptable to consider each pool’s LP token separately due to pool mechanics, although ‘Approve all’ is a bold request.

2 Likes
4

I am for keeping it simple and easy to understand. Who needs this?

1 Like
5

Hey @mantas made some edits to highlight benefits + risks, as well as making it more clear which assets I would be looking to have included under this initiative. This would not be a blanket proposal for all assets.

6

Me. The person who wants increased yields and better borrower benefits

7

Want my vote on this or any other proposal. Lets start with some transparency shall we?

  1. specific details regarding Safety Module.

  2. Details on MVP and how it affects SM

  3. Specific details regarding improvements for Lenfi Marketing and communications

  4. What are your roles and responsibilities with Lenfi and with BTN? Are you being compensated by both teams?

2 Likes
9

https://twitter.com/Dubbleu_43/status/1773003288717177237

^ see reply when this was originally asked.

1 Like
10

I don’t think the limited benefits are worth the potential negative discussion surrounding the risk. It likely would never be a problem, but there would be someone out there happily highlighting it.

ETA: I guess if it’s only used for collateral in V1, the single lender is knowingly assuming the risk.

1 Like
11

I do like the fact that we could utilise LP (Liquidity Provider) tokens on P2P market.
Assets derived value should grow over time, specially if LP token is of well utilised pool.

Some things to note:

  1. Risk the LP asset will have new risk of ‘claimability’ attached. It can be unclaimable if pool utilisation is very high or V2 Smart contracts risk. Maybe something else that I can’t see now. It’s already well stated in proposal.
  2. Technical implementation is leasable without updating V1 contracts. It will require additional indicators on the UI as well as changed on V1-liquidation-oracle.

I do also suggest to strictly define what pools LP we want whitelist.
I do recommend these:
ADA/LENFI

ADA/SNEK

ADA/IAG

All of the underlining asset is ADA, meaning LP tokens accepted as collateral is LP token derived from ADA.

1 Like