Summary
Add DOLA lending to a new Rari Fuse Pool managed managed by SquidDAO This proposal will allow their users to borrow DOLA against supplied assets including Squid as well as to allow DOLA holders to supply DOLA to the same pool to earn yield.
Background
Inverse recently began discussions with SquidDAO in relation to a new Rari Fuse pool they are launching as outlined in their forum here Creation and deployment of SquidDAO Rari Fuse pool - Strategies - SQUID DAO
About SquidDAO
SquidDAO was formed in October 2021 as a sort of combination of Nouns DAO and Olympus, but using the concept of emphasizing “stacking” ETH in its treasury. Squid deploys the ETH in its treasury to generate yield.
Squid DAO’s mission is to be the future of finance, embracing fairness, transparency, meritocracy, partnership, equal access, all with ETH as the unit of account. Squid DAO stacks ETH in a non-dilutive manner, while giving the community full control of the systems, fees, and revenues via NFTs (SQDN) and veSQUID governance. Staking SQUID will ultimately outperform simply holding ETH.
More info here:
Current SquidDAO marketcap is approx $53 million and price per Squid is approx $269,000.
About Squid’s Rari Fuse Pool Proposal
Squid is proposing the launch of a Rari Fuse Pool with multiple collateral assets including:
-
ETH,
-
USDC,
-
LUSD, and
-
GOHM
as well as their own rebasing tokens
-sSQUID (staked SQUID) and
- wsSQUID (Wrapped Staked Squid)
There is also mention of adding Ribbon, Pickle, and Lido governance tokens to the collateral options.
Their proposal mentions launching the pool with a single stable on the borrow side - which would be DOLA.
Collateral ratios being proposed are:
wsSQUID, sSQUID - 45%
ETH - 75%
USDC - 85%
LUSD - 75%
gOHM - 69%
Risks/Considerations
- Squid is using a custom built oracles for SQUID/ETH using same custom oracle code used for gOHM oracle. (Source: SquidDAO). The ETH/USD oracle they use is a Chainlink oracle.
- SQUID is a new token with <2 months of history and should be expected, like other OHM forks, to show high volatility.
Mitigating Risks
- Require high collateral ratios similar to Floki of 200% or higher (300%), lowering the ratio over time as we gain more experience with SQUID but protecting Inverse’s risk exposure in the short term.
- Begin partnership with relatively small DOLA lending facility and increase over time as our experience with Squid grows. Starting amount TBD.
- TVL is~$48 million, code is a fork of Olympus.
Justification For This Partnership
- Multiple rebasing token apps are adding lending features and would like to include a DOLA borrowing facility. While the rebasing token market has been showing volatility lately, total TVL across all rebasing tokens continues to climb and DOLA as a strategic matter needs to be part of these lending facilities in order to be a competitive stablecoin.
Proposal
- Whitelist DOLA Fed contract for Upcoming SquidDAO Fuse Pool as a DOLA minter
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Links and resources
Resources
Gitbook: Introduction - SQUID Dao 9
Squid DAO website: https://squid.xyz 50
Opensea Collection: https://opensea.io/collection/squiddao 15
Dune Analytics: https://dune.xyz/0xvisual/Squid-DAO 4
Wallet Addresses
Genesis Deployer Wallet: 0x85277BD3D3273994Ce65FA1Bb9D0bf7Da0b1980b 1
Contracts & More Multisig Contract: 0x42e61987a5cba002880b3cc5c800952a5804a1c5
NFT Contract: 0x7136ca86129e178399b703932464df8872f9a57a
$SQUID Contract: 0x21ad647b8F4Fe333212e735bfC1F36B4941E6Ad2 6
$sSQUID Contract: 0x9d49bfc921f36448234b0efa67b5f91b3c691515 2
APY Distributor: 0x2d99d0b76168e315f2dc699bff8d47be30b3f9d7 2
$SLP (LP Token) Contract: 0xfad704847967d9067df7a60910399155fca43fe8
Treasury Wallet: 0x61d8a57b3919e9F4777C80b6CF1138962855d2Ca 2
Time Locked Treasury Manager: 0x8CFC7e4AFC370A159fc84157fcAd82A766C774bE
SQUID/ETH SLP Bond: 0x5ab2493d75cbccd0762417839c83ab6b567d2f71 1
WETH Bond: 0xd9cf92F1e3758EdE8bb47e37CAc7927dFbd54c12