Whitelist Stake DAO as Fuse pool creators.
If passed, this proposal will enable the creation of Fuse pools that utilise Stake DAO assets (SDT, xSDT and/or Proof of Deposit/Delegation tokens) as collateral. If passed, Fuse would be the first platform to support SDT and other Stake DAO yield-bearing assets.
Presently SDT (Stake DAO Token) has a market cap of $20m and over $90m in strategy deposits on Ethereum; Stake DAO assets such as SDT and Proof of Deposit tokens e.g. sdEursCrv will be used to create Fuse pools. Further details on the benefits of integrating our two protocols are in the #motivation section.
Stake DAO References
Link to project: Stakedao.org
SDT token: 0x73968b9a57c6e53d41345fd57a6e6ae27d6cdb2f
xSDT token: 0xaC14864ce5A98aF3248Ffbf549441b04421247D3
Stake DAO Governance forum: https://gov.stakedao.org/
Socials: Twitter, Telegram
Whitepaper: refer to Stake DAO’s medium.
Insurance: All funds deposited into Stake DAO smart contracts can be insured through Nexus Mutual for material loss of funds due to smart contract bugs. There has never been any loss of funds.
Stake DAO is a multichain DeFi protocol that brings cutting-edge strategies, cross-chain interoperability, and smarter staking all under one roof. Built by some of the contributors behind Curve Finance and other leading DeFi protocols. Stake DAO now hosts more than $160 million (TVL) across Ethereum, Polygon, BSC, and validators for for PoS assets such as Cosmos, Solana, and Tezos. We are committed to onboarding new users into DeFi through initiatives such as academy.stakedao.org as well as several B2B partnerships in DeFi with protocols such as Frax and partnerships with firms such as Swisborg.
Stake DAO token (SDT) is the governance token for the Stake DAO protocol. Currently, SDT is not on any major lending market in which SDT and other synthetic assets could be used as collateral to borrow other tokens. Stake DAO’s initial Fuse pool would create the first liquid lending market for SDT in a lower/average risk Fuse pool, giving SDT holders the ability to borrow against SDT This is an important function for the SDT token, enabling Stake DAO users to hold SDT and remain invested in the project’s long-term success while enjoying the ability to leverage/hedge.
Currently, SDT has three use cases:
2) Staking SDT in the Sanctuary smart contract. This enables The Herd (Stake DAO’s community) to earn a share of protocol revenues from DAO activities (Strategies, SaaS and NFTs). Depositors receive xSDT for SDT deposits and protocol fees are distributed in SDT.
3) Deposit xSDT into the Palace to mine Points for Stake DAO NFTs that unlock special features within the broader Stake DAO ecosystem.
This proposal would enable the creation of a lending market for SDT, enabling the Herd to borrow against their SDT to hedge or leverage.
For Rari, whitelisting Stake DAO as a pool creator would directly:
1) Increase protocol utilization and fee revenue for Rari through 2 main funnels.
1.1 Native SDT and xSDT deposits into Fuse.
With a Market cap of ~$20m as the first protocol to list SDT as collateral, Fuse would be able to receive these SDT in deposits.
1.2 LP token deposits.
When users deposit into Stake DAO strategies, they receive a Proof of Deposit token representing a claim on their deposited capital. Fuse pools for these tokens should drive a significant volume of deposits into Fuse.
Currently, Stake DAO has >$90m in strategy deposits on Ethereum; Proof of Deposit tokens from these strategies could be used in the lending markets provided through Fuse.
2) Heighten exposure for Fuse and thereby the Rari protocol.
As the only live lending market for SDT (at time of writing), our community of 10,000+ users would actively utilise and drive attention to Rari. We have a community that would appreciate the utility of borrowing against their SDT tokens. The benefits here are too numerous to state, so in summary, this will directly lead to organic growth for both protocols.
3) Provide a solid foundation for future collaboration.
Stake DAO will work closely with Rari to bolster a symbiotic relationship between the two protocols by utilising Stake DAO assets as collateral for future pools. These tokens fit well in Fuse’s value proposition as these synthetic assets are considered long-tail assets. Stake DAO will also consider other future pools, for instance, a Fuse pool to deposit some portion of treasury assets. Any future events will be subject to the approval of Stake DAO community governance.
Given the level of deposits that Stake DAO can drive to Fuse and in line with the recently passed proposal from Fei protocol, we propose reducing the protocol fee to 6% for 6 months (we can see where we stand and reassess then), provided that we supply a minimum liquidity of $10 million. This would also enable us to more easily pass this through Stake DAO community governance.
The benefits of this would be:
- Continuously aid in securing the pool's current assets.
- Align incentives so that increases in scale result in higher efficiency.
- Passively fund security analysis/upgrades (as well as access to our smart contract team, as demonstrated previously by Julien B).
- Passively fund upgrades that directly benefit both platforms.
These are our initial thoughts, we invite you to contribute to the above.