How do we create value for Anchor?

Hi Community,
I have been invested with Anchor before I invested in Luna. Now that I hold a decent bag of Anchor, in last year plus my Investment value has diminished. Yesterday I was in the Anchor telegram room and I raised the following query…

Anchor is meant to be no 1 application in the Luna ecosystem which has created tremendous value for the entire ecosystem and is critical for its success. Now that the value of Luna is increasing how come Anchor has not created any $ value for its holders?

I was advised that the reason Anchor exists is to add to the value of Luna and increase UST adoption… The main use of Anchor is that it’s a governance token.

As a long-time investor in anchor, I question myself if I did make a mistake as my investment has seen no gains. I invest to make money. As Luna’s value has increased unfortunately as an Anchor shareholder I have not seen similar growth, on the contrary, I might have less $ value than when I started.

I am keen for the Anchor shareholders to consider how we can increase the value of Anchor in a similar way that Luna is getting more valuable.

The only way forward I see is it being $$ valuable is if we start a transaction cost on interactions with Anchor, be it saving, borrowing, or lending. I do not have a banking background but common sense tells me that there should be a joining fee and an exit fee. An example is if you add 100 $ in anchor saying then .50 % of total deposit to be subtracted from the interest return and on exit, a .50% subtracted as an exit feel making the total fee = 1%

Similar logic is applied to providing borrowing and lending as is happening with other Defi leading applications.

With the revenue generated .20 % could be used to burn Anchor .20 % reward Luna stakers and .45 % used to reward anchor stakers with Luna, Anchor, and UST rewards and .05 % in the Anchor community fund.

A similar logic applied to applications that build on Anchor and say 75% value comes to anchor and 25% goes to that application token in Luna, Anchor, UST rewards

Hoping the community would support this or a similar proposal to uplift the value of the Anchor token.

It’s a win-win for Anchor, Luna, and Applications who are building on top of Anchor.
Thank you

I used to think the same for $ANC but I’ve since realised this might be a matter of timeframe or perspective.

For example, MakerDAO and its token launched early 2017 and it was only in mid 2021 that its price has really stepped into the next level, holding $1,500 consistently.

Anchor is less than a year old (launched in March this year) so I think we should be patient.

If we wanted to help we could help to advertise the incredible savings rate to our friends and family but also remind them of the risks.

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This is being explored. Please see https://forum.anchorprotocol.com/t/suggestion-short-term-enhancements-for-anchor-protocol/1515/25

As luna increases in value and a lot of apps coming on top use of Anchor is bound to increase. Not seeking rewards straight away but it can be brought in incrementally. Thanks

We are the flagship of the LUNA ecosystem, basically. As LUNA’s low fees and good ecosystem attract more users, Anchor will benefit a lot. Rates/incentives on Anchor are extremely attractive relative to other platforms, too.

Be patient.

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In this stage of Anchor I would focus more on how can we make Anchor the leading lending/borrowing market. We need to win the game and extract value when the market share of Anchor is high enough. As of now, there are still ways how we can improve. For example, we can create a permissionless money market or be the first to implement undercollateralized lending. Both are hard to do right, but both are also the key to long-term success and sustainability, at least from my point of view.

I’d be happy to explore the possibilities of how we can implement that with the team if the team is open to it.

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What other lending or borrowing markets do you think we can learn from?

would like to hear your ideas.

Mars is currently working the undercollateralized side of this. It’s a totally different business model. IMO we need to be going after IBC DEXs, creating lending SDK etc. There is a forum post that has all the ideas from the community here: Call for ideas: how to encourage more borrowing? - #15 by Kram

To increase borrowing, I believe we just need to accept more assets.

But for increasing value, a community pool from the exit would be a good idea. Don’t think a fee from interest return would be beneficial though as it disincentivizes people from lending long term.

I don’t think we need to reward Luna stakers though. I believe most Luna stakers that does not use Anchor just claims their airdrop and swap it for UST anyways.

I believe the community pool should not be used to buy ANC tokens for short term price spikes though, wouldn’t it be awesome if we have a large enough community pool as an additional insurance for the protocol?