We propose to take $2,000,000 of USDC from the treasury and deploy it on the Rari Capital Stable Pool for a period of one year. As of this writing this will yield 13.2% APY. The PoolTogether protocol would earn $264,000 over the course of one year. These funds can be withdrawn from Rari early with the passing of an on chain proposal.
With the recent treasury diversification from PTIP-11: Treasury Diversification the PT protocol is in control of about $6.27 million dollars in USDC. The reasoning for the diversification was for long term sustainability. A portion of this USDC could be put to work earning yield for the protocol to further extend our runway, support more funding of large PTIPs, projects, and development.
If the $2 million we propose to deploy is put into sponsorship it will earn $80,200/year on compound at current rates (2.3% apy plus 1.7% in comp rewards).
80,200/52 weeks = $1540/ week added to the total prize in the USDC pool. This is a negligible increase in the weekly prize. The interest earned deploying to Rari Capital would be 3.3 times higher.
The protocol does not need all of the $6.27 million at once. We are missing out on extra yield that could be used as stated above.
A few other yield sources were considered (Yearn, Cream.) Those come with tradeoffs. Cream has been exploited in the past, and Yearn is deposited into the protocol already. The yield on some of these sources is also substantially lower. If we used Yearn we would essentially be contributing to the Yearn “Pod” and taking away from current PoolTogether depositors.
The Rari Eth pool was exploited in the past via an integration with Alpha Finance, but that has since been resolved and did not affect the Stable Pool. Rari offers a source that is relatively more safe than others and currently independent from PoolTogether. There has been general support from the community to put a portion of our treasury funds to work. This is a relatively safe, and simple way to increase the value of the PoolTogether treasury passively over time.
- The details of the on-chain proposal
Deploy $2,000,000 of treasury USDC to Rari Capital stable pool.
Send 50 POOL each from the treasury to @AndyKaufman & @RegisIsland for authoring the proposal.
Send 20 POOL from the treasury to developer @McOso for creating the transaction.
Send 10 POOL from the treasury to @rliriano for inspiring us to create this PTIP
The current specific technical details of the transactions required for using the timelock funds, depositing to Rari Capital stable pool & specific rewards to contributor wallets will be updated.
Currently seeking feedback from the community and how it might impact the decision of PTIP-17: Deposit USDC into USDC Prize Pool Sponsorship and creating the function to create the transactions on chain.
- $2 Million
- $1 Million
- Against this proposal