Proposal: Add OADA and sOADA to Lenfi as borrowable and collateral assets

Graveyard
1

Proposal: Add OADA and sOADA to Lenfi as borrowable and collateral assets

Proposal Description

We would like to add both the OADA and sOADA tokens to Lenfi V2 as an asset for lending/borrowing.

Short Summary

OADA by Optim Finance is the first yield aggregation an liquid staking token system on Cardano

  • Approve
  • Disapprove
  • Abstain
0 voters

Motivation

  1. Who is posting the proposal?

I am a member of the Optim ODAO

  1. Project and token overview

OADA is a yield aggregation system that utilizes a two tranche token system. It is a synthetic (though not in the butane or indigo sense) pegged to ADA.

OADA is staked to become sOADA.

OADA is stripped of all staking yield, and sOADA inherits all the yield and also risk of the system. If the system were to take any losses, sOADA would bear the risk of such an event and OADA would not be affected.

However, risk profile for the system is low and it is intended to be so as the system grows.

sOADA can be unstaked back to OADA at any time. To “redeem” OADA back to ADA, users must swap it using the Splash stableswap OADA/ADA. The system provides very very deep liquidity to this swap for the sake of exiting the system, and it is the only way to return to basic ADA after one has minted (aside from other token pairs, but they will never have the same quality of liquidity as the stableswap.

OADA maintains its peg within a one percent range (0.99-1.01) through automatic buybacks and arbitrage opportunities managed by the system. The system interacts with the stableswap to maintain and arbitrage peg via minting, burning, adding LP and removing LP.

sOADA is a particularly attractive collateral asset because it is yield bearing. OADA is less attractive in this way because it bears no yield, even less so than regular ADA. But I think both should be considered as options for collateral, each with different considerations.

OADA and sOADA are not governance tokens like $OPTIM or $LENFI, they are more similar to iBTC or iETH - but with very different functionality. The OADA system has already acquired 3.5m ADA TVL in two days and will continue to grow.

The OADA/ADA stableswap has grown to ~7.5m ADA TVL.

References

4 Likes
2

If there’s any questions about the System’s inner workings or so I’m available to explain

3 Likes