Draft Proposal: Convert A Portion Of Treasury To bLUSD, FPI, and stETH or frxETH

We have a sizable treasury, let’s convert it into relatively safe assets that accrue value.

bLUSD seems to accrue roughly 6-13% APY, from underlying LUSD treasury.
Docs: Basic Usage - LUSD Chicken Bonds
Dash: πŸ” LUSD Chicken Bonds

FPI aims to peg to inflation-adjusted USD, since May it has accrued ~7% vs USD.
Chart: https://app.frax.finance/
Docs: Overview (CPI Peg & Mechanics) - Frax Finance Β€

If these seem too risky, we could do something like AAVE’s or Compound’s value accruing stablecoins (aUSDC, aDAI, …). I think these yield ~2-5% APY lately, and higher in bull markets when there’s demand to borrow USD.

Similarly, for the portion of our treasury in ETH, we could hold a liquid staking derivative like stETH or frxETH to get ~7-11% APY.

(I have been very busy lately, so feel free to discuss/move forward with this proposal without might input from me if I’m slow to reply!)

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This proposal was discussed in the 04/03 conclave meeting.
We might collectively need more education on the proposal.

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I’m against this and would much rather just convert more to ETH

  1. Why lock funds up for a few % points if we could get a similar return just buyingmore ETH – and be able to use it in the meantime?
  2. Defi protocols can and will be hacked.
  3. Chicken Bonds? The name alone sounds like a ponzi. I’m sure it’s not, but yeild farms are a dime a dozen. AAVE/Curve/Uni/whatever – I think it’ll be hard for us all to find a consensus one which one is best. ETH keeps things simple.
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wrt 1 – none of the things I suggested β€˜lock’ funds. Each of them can quickly/cheaply be converted back to USDC or ETH.

2 & 3 are fair.
imo the protocols I suggested are pretty safe, but I understand not taking even small risk with treasury. AAVE/Compound are probably safest for USDC but yield pretty low right now.

I’m open to converting more to eth now, but how about stETH or cbETH to get staking yield? stETH has been around for a long time with a ton of ETH in their protocol, so quite safe imo. cbETH is by Coinbase so also likely to be quite safe.

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I’m a simpleton, I will always just prefer ETH but will be interested to see how other weigh in.

I agree with this. Though I understand the want to get a high yield stable coin. You’re better off just putting it in a U.S. money market mutual fund getting 4.8% right now but given the current market I would say DCA the usd into eth. To avoid being wiped in a black swan event. Why not just DCA alike $500 a week into eth regardless