We are building an interest earning perpetual swap using aUST as collateral. I know there are several teams planning to do that as well.
It is nice to have your money being saved. What is even nicer is you can actually invest with these saved money. In TradiFi that is hard to do for average people. But in Defi it is frictionless as you will have you yield bearing token (aUST), and can do other financial activities with it.
One doesn’t have to be degen to invest with saved money. You mentioned Mirror, but there are plenty of other interesting protocols in the making.
There are many strategies and possible improvements that have been discussed for AnchorV2 within the pages of this forum. I think that most of them would represent an improvement for the protocol.
We all have a focus to increase the yield reserve/limit its usage. The strategy above is a step forward but I think it should be combined with others. IMO this idea is not enough to make the protocol sustainable. I think it should be combined with other strategies (e.g. thresholds for ANC stakers, lock-up periods etc)
a. Increase in collected borrow interest decreases expenses from the yield reserve, thus having a positive impact in the YR balance.
b. Increases in staking rewards directly have a positive impact on YR
We are hoping to remain patient as well so we don’t overshoot since we need to see
how the cross-chain borrow efforts also buffer the yield reserve. These new changes will all be governance parameters that can be adjusted over time if they are not having the intended inputs.
This is something that is the community is talking about and has been brought up on the last two recent AMAs, The general idea is to wait to see how the results play out on the borrow side.
Sorry, It’s not in my best interest to voluntarily vote for yield reduction.
It’s not my place nor job to worry about long term well being of Anchor. The people responsible for that endorse parasite degen boxes, if they don’t care about the long term well being of Anchor, why should I?
I agree with the dynamic rate. However, I think we should try to keep the 19.5% APY for as long as possible this way we can overtake the biggest centralized stablecoins and solidify the Terra ecosystem’s position in DeFi.
Considering that ANC incentives will be over in 3 more years I think it makes sense that we try to keep the high yield for at least 3 more years. The Luna demoninated community funds will appreciate due to high UST demand anyway so topping off the yield reserve periodically when necessary for 3 more years won’t become ever more difficult.
After those 3 years then we can implement the dynamic stable rate and move towards complete sustainability.
I know and I believe this is the best solution right now, to see how we can stimulate borrowing given the new collateral and strategies in pipeline.
IMO some strategies for the ANC token price and for the earn side should be centralized in order to have a better overview (Notion form probably, I can volunteer to keep it!) and implemented some of them. I think that an Agile continuous development of the product is better as it reduces the risk of rejecting large/difficult proposals through governance and it reduces implementation effort. To make the long post short, we could start centralizing outside this forum some of the strategies, vote and then implement some small ones in order to see how they affect the protocol.
The proposal from mariano is truly the best of all and manages to strike just the right balance. IMO it should be implemented ASAP, before anything else and certainly months before any changes to the APY (variable or other). Than sooner it’s in place, the longer the yield reserve will last, giving more time to ramp up lending and work on a more sustainable APY long term. It’ll make Anchor cleaner and stop the yield drain, with no real impact on usability. Simply put, it’s what Anchor needs right now, from multiple perspectives.
Perhaps a2UST could be created by staking aUST to a specific contract, thereby making it immovable, but with higher yield. I do think for a2UST there needs to be some form of capital controls (lockup periods, etc.), otherwise this can be easily circumvented by a different protocol minting a wrapped, transferable version of a2UST.
This could fit the demand for the 2 user types of Anchor, aUST positioned towards DeFi applications with composability in mind and a2UST facing towards regular depositors such as third-party applications (which they don’t need composability)
aUST yield would still need a degree of yield flexibility, for Anchor to fluidly react to long-term market changes. This can go hand-to-hand with the dynamic Anchor rate.