January 20, 2022 -- Twitter AMA -- The Road Ahead

Hey Gang.

It’s been a while since I was on the forum. I know a number of you have been discussing the future of Anchor on a couple of different threads the past few weeks. I move that we consolidate those discussions here as today’s Twitter Space Community Call focused on a number of the issues important to the community, namely sustainability and the road ahead for Anchor. Consolidating here will make it as easy as possible for Ryan and the rest of the Anchor Dev team and outside advisors to see what’s on the mind of the community.

A lot of items were discussed on today’s call. The most important came when Ryan and N8 revealed that Anchor is moving to accept other yield bearing assets as collateral for UST loans – not just SOl & ATOM. >>> Think Abracadabra without the option of automated looping. <<< This is GREAT news! HOWEVER … it’s going to take time. What I didn’t hear today (…and admittedly I was a few minutes late to the call) was what the Anchor Team is going to do in the short to mid-term to shore up the Yield Reserve which, as anyone who has been paying attention knows, is absolutely hemorrhaging cash --AND-- based on current trend will be at $0 in a matter of weeks (not months). Full Stop.

Anchor is now the de facto foundation of the entire LUNA ecosystem. So… Anchor … what’s the plan in the short term???

My Fingers are crossed.
-D.B.

Thanks for dropping by. We hope to have a cross-chain anchor done before the yield reserve runs out. No need to sound the alarm so loudly as we still have some time to pivot if needed. If we don’t solve the borrowing even lowering the rate to near zero doesn’t help, it’s a short-term fix. Getting more borrowing is the real key right now and getting there fast hence all the push on these changes.

1 Like

n8-

Thanks for being in touch. So that we’re clear … I love what you guys are trying to do at Anchor. I’m a fan of everything from the model to the UI / UX. I made my first deposit back on May 1, 2021. It is the defi protocol I interact most with and my stacks of bLUNA and bETH are considerable. I’m also sitting on 6 figs of UST loans. I say all of this only to offer some context. I very much want you to succeed and I tell everyone who will listen about Anchor. That said, you guys have a big problem on your hands that --I’m happy to hear-- you seemingly realize can ONLY be solved by your customers / clients taking more and/or larger UST loans. The sky isnt falling today however if the community begins to lose faith in Anchor – which will happen if the Yield Reserve dips below say $10MMish – the platform could implode which will have serious repercussions across the entire Terra ecosystem. I dont want to know what that looks like. A lot of people in the Anchor community don’t seem to understand how serious the situation actually is. (They’re not all that engaged … as evidenced by the current Oracle Refund Poll numbers.) I have no expectation that you will share with me exactly what the plan/timeline is and I’m not trying to make your life harder BUT I hope you and your team understand that bringing online SOL & ATOM alone is not going to fix the problem. I’m hoping that what I heard today means you all plan to open the flood gates to all manner of yield bearing assets (multichain) as collateral AND that you’re going to have it done in the next several weeks. THEN … you have to keep those NET APR Loan costs down. The competition is way too fierce for rates to be pushing 5%. (The cost of borrowing at Abracadabra is only 2.5% on the UST Degenbox.)

My fingers are crossed and I wish you the best of luck.

-D.B.

1 Like

Hi, you said on one of my posts that it would be prudent to decrease the borrow APRs for cross-chain anchor.

What did you exactly refer to? Like different APRs for different chains? Or once that cross chain is achieved lower borrow aprs across all anchor?

You may be able to roll out the cross chain borrowing in time, but it’s going to take a while for marketing and awareness and probably at least another month before we can see the impact of it.

Why not apply for a funding grant from LFG to buy some time to get this over the line? My suggestion would be a 60 day subsidy on the yield reserve (approx $60M at current rates).

Let’s be honest. There’s nothing more critical to the entire Terra ecosystem and UST right now.

Yeah speed is everything here so let’s get everything cross chain and then see what that looks like because lowering the aprs for each chain would require different deployment of the aUST model which is really cumbersome

2 Likes