PTIP-68: OTC Settlement for Ondo <> Fei LaaS Program

PTIP-68: OTC Settlement for Ondo <> Fei LaaS Program

Simple Summary

Now that the Ondo <> Fei LaaS vaults have come to maturity, PoolTogether needs to rebalance the position with Ondo and receive back our POOL. Since the price of POOL went down during the program the protocol will receive back more POOL and need to send USDC to Ondo. This proposal would send 350,559.66 USDC to Ondo, the Ondo team will send back 307,693.06 POOL to the PoolTogether treasury (93,639 more than originally provided). In addition, the protocol has already received 67,828.55 TRIBE tokens from the program.


With PTIP-50, the community approved $1.5m of POOL to be deployed into Ondo + Fei’s Liquidity as a Service (LaaS) program, where FEI was deployed in the fixed-rate position and POOL was deployed in the variable rate position. Now that the vaults have matured, PoolTogether has opted to settle with Ondo <> Fei OTC to avoid an on-chain rebalance of POOL to Fei which would incur significant slippage.

To avoid needing to rebalance on the market with low liquidity, this proposal seeks to settle the debt and bring the Ondo <> Fei LaaS program to a close, for now.



In order to receive the 307,693.06 POOL held within Ondo’s smart contracts now that the program has concluded, PoolTogether needs to settle the 350,559.66 USDC debt.


When PoolTogether deployed POOL into the LaaS program, 214,000 POOL was allocated to the variable-rate position. Fei Protocol provided 1,134,200 FEI in the fixed-rate position, with a hurdle of 5.13% APY to be satisfied at maturity.

Community members can review the FEI POOL OTC Settlement terms for a breakdown of the difference in FEI and POOL tokens now that the program has concluded.

The settlement terms highlight the difference in FEI + POOL at the conclusion of the program, where PoolTogether has an additional 93,693.06 POOL tokens, which are valued at $278,268.38 given today’s prices ($2.97 at time of writing). The DAO also received 67,828.55 TRIBE valued at $34,850.85 given today’s prices ($0.513808 at time of writing). Taking these amounts into account, the net cost to the protocol is roughly $37,440.43 when POOL and TRIBE is taken into consideration along with the senior position hurdle.

Settling directly with Ondo will prevent further sell pressure on the POOL token, which would happen if POOL were exchanged for FEI directly on-chain.

I spoke with Gabriel Bianconi from Ondo and reached an agreement on these terms. Upon execution of this PTIP, Ondo will send the 307,693.06 POOL back to the protocol treasury.

Technical Specification

call withdrawFrom YieldSourcePrizePool (0xd89a09084555a7D0ABe7B111b1f78DFEdDd638Be)
from 0x42cd8312d2bce04277dd5161832460e95b24262e (gov timelock) amount 350559660000

call transfer USDC contract (0xA0b86991c6218b36c1d19D4a2e9Eb0cE3606eB48)
to 0x7EBa8a9cAcb4bFbf7e1258b402A8e7aA004ED9FD value 350559660000


On-chain: PoolTogether Governance
pPOOL Snapshot vote: Snapshot


where does the 350k+ USDC amount come from, I must be really out of it, I’m not getting it to click at all, apologies.

Wait I think I got it, it’s the total POOL value (278k+) + TRIBE value (34k+) + Fee (37k+). So that 37k+ is the effective fee we’re paying to Ondo for the LaaS service?

Not quite. If you look at the sheet, the column titled “Hurdle” reflects the interest rate for each vault.
Vault 1: 0.99% (5.13% annualized) > Cost of $2,807.145
Vault 2: 1.07% (5.13% annualized) > Cost of $3,033.985
Vault 3: 1.23% (5.13% annualized) > Cost of $3,487.665
Vault 4: 1.23% (5.13% annualized) > Cost of $3,487.665
Total Cost of Vault Hurdle: $12,816.46
IL Impact: $24,623.97*
* Total cost after TRIBE rewards + additional POOL value factored in

I’ll provide an analysis of performance once the debt has been settled.

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Hi everyone - Gabriel from Ondo here. We’re excited to settle a successful first cohort of vaults with PT.

@Taliskye Just to clarify, Ondo does not charge any fees for this service. The payment is needed to cover the hurdle rate (interest) to Fei, and any imbalances from impermanent loss in the trading pool. Please note that PT is receiving ~94k additional POOL tokens on top of what was deposited (plus ~68k TRIBE in rewards). PT deposited 214k POOL, and will receive ~308k POOL after the OTC settlement.

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