As most of you will be aware, Curve has been awarded an NFT representing voting power in our friend Andre Cronje’s new protocol Solidly.
We have been approached by a team called Solidex aiming to become the Convex of Solidly and we plan to go with them as partner after Geist and Multichain (formerly Anyswap) and other protocols we are close with joined them. Their proposal will guarantee we are able to grow our voting power as the DAO would be allocated a share of their total supply.
The plan will be to create a CRV/FTM pool on Solidly AMM and assign our voting power to it to ensure CRV holders can farm SOLID using CRV, this will also help ensure strong on-chain liquidity on Fantom for CRV going forward and until we can launch the crypto factory on sidechains and L2s. While their proposal would also allows us to tokenize the NFT, we believe it is in the community’s interest to keep and grow the position on behalf of the DAO.
Totally agree with the approach of partnering with Convex-like protocol for the management of the Solidly NFT.
I was looking at Radial, another protocol also aiming at becoming the Convex of Solidly. Looking at the two side-by-side:
Initial supply to partner protocols: Partners will share minimum 10% for Solidex (SEX) and up to 15% depending of numbers of partners vs. 10% for Radial (RDL) => SEX seems more favorable, though it will ultimately depend on the number of partners for each
Protocol fees: 10% of SOLID earned by LPs is taken as a fee for SEX vs. 15.1% for RDL => Again, SEX seems more favourable as it is less extractive for LPs and is likely to attract more liquidity.
Fee redistribution: 5% to SEX lockers in the form of SOLIDsex vs. 5% to RDL lockers in the form of rdlSOLID => So no difference here, the most profitable will be the one attracting the most fee generating LPs. However, RDL is also incentivising SOLID holders to lock by sharing with them 10% of the protocol fees whereas there is no direct fee sharing with SOLID lockers on SEX. This is somehow mitigated by SEX which will redistribute 5% of the fees to the SOLIDsex/SOLID LPs. So at first sight SEX seems more attractive to LPs whereas RDL seems more attractive to SOLID lockers. This is interesting because you need to attract a significant amount of SOLID to gather enough influence to meaningfully optimise yield for the LPs. Not sure how it will play out, but RDL might have the upper end.
SOLID inventory management: A big part of the success of a Convex-like protocol for Solidly will be based on how well it manages the inventory of SOLID it controls between locking and not locking those. This is summarised in the below matrix from RDL docs. There is little info available on the SEX side, but from this Medium article it seems like the plan is to lock all SOLID deposited in the protocol, which would be detrimental to LPs and the entire Solidly ecosystem in the long run. RDL seems to have put a bit more thoughts into it, though there is no clear plan yet and it will depends on what the DAO chose to prioritise. Maybe that is why SEX decided to not incentivise SOLID lockers directly, but instead SOLIDsex/SOLID LPs, which basically means SOLID holders get the best returns by only locking half of their SOLID and providing liquidity against the other half, which is maybe the optimal long term equilibrium… quite brilliant actually!
Team: Both seems to be anons, SEX has merged with the Grape Finance team, RDL seems to be close to LobsterDAO with two of the multisig signers doxed on Twitter. I have no views here.
I could not fine the Solidex docs (only the Medium posts), it would be good to be able to read something a bit more detailed to form a better view, but from what I have seen, I would support SEX over RDL.
Nevertheless, I wanted to share that here to see what other people think. Maybe worth engaging with RDL team too to see what they have to say?
“Their proposal will guarantee we are able to grow our voting power as the DAO would be allocated a share of their total supply.” How does this benefit $veCRV-holders? Will the supply be distributed proportionally between lockers? Will revenue be distributed to lockers? As I see it this mainly benefits lp’s liquidity wise.
I think what will be done with farmed rewards of the SOLID derivative is a post-launch conversation as we don’t have enough information at hand. The SEX tokens will quite likely be locked to vote for a CRV/FTM pool.
The answer to your your top left box is CDP stable capital extraction. Correct me if im wrong. Deposit Solidly into abracadabra, extract mim as your income
