Proposal to add DOLA and USDz pools to the Curve Gauge Controller
Summary:
Proposal to add the following 3 pools to the gaguge controller:
sDOLA/USDz
References/Useful links:
Inverse:
- Website: https://www.inverse.finance
- Documentation ABOUT INVERSE - Inverse Finance
- Transparency: Inverse Finance - Transparency Overview
- Github Page: Inverse Finance · GitHub
- Communities: Inverse.finance
- Defillama: Inverse Finance Page
Anzen:
References/Useful Links
- Website: Anzen Finance
- Documentation: Anzen Docs
- Transparency: Transparency
- GitHub: Anzen Finance GitHub
- Communities: Discord | Twitter
- DefiLlama: Anzen Finance Analytics
Protocol Description:
Inverse Finance
Inverse Finance is an on-chain decentralized autonomous organization that develops and manages a suite of permissionless and decentralized financial products using blockchain smart contract technology. Originally founded by Nour Haridy in late 2020, the protocol is now governed by Inverse Finance DAO, a collective of crypto enthusiasts.
Inverse Finance’s main products are:
- FiRM, a fixed-rate lending market
- DOLA, a stablecoin pegged to the US Dollar
- sDOLA, yield-bearing version of the DOLA stablecoin
- DBR, a new DeFi primitive that enables holders to service a DOLA loan on FiRM.
DOLA is a debt-backed USD stablecoin which is added into and removed from circulation;
- On the supply side of money markets, such as DAO-owned protocol FiRM, by Inverse Finance’s “Fed” contracts and is then made available to be borrowed through over-collateralized loans.
- Via injection/contractions into pools such as the Curve DOLA/FraxPyusd, DOLA/USDC on Velodrome, DOLA/USDC on Balancer and DOLA/USDC on Aerodrome.
Anzen
Anzen Finance is a decentralized platform focused on bridging traditional private credit markets with decentralized finance (DeFi). Anzen offers a suite of innovative products that provide users with sustainable yields and transparent risk management. The cornerstone of Anzen’s ecosystem is USDz, a stablecoin fully backed by a diversified portfolio of real-world private credit assets.
Key Products and Features:
- USDz: A stablecoin pegged to the US Dollar, fully collateralized by high-quality private credit investments. USDz ensures stability and security by adhering to rigorous underwriting standards and compliance measures.
- sUSDz: A yield-bearing version of USDz. Users can stake USDz to receive sUSDz, which accrues value over time through yields generated by the collateral portfolio.
Core Principles:
- Transparency: Anzen provides detailed insights into its operations, collateral backing, and portfolio performance via its transparency portal.
- Risk Management: USDz’s backing assets undergo thorough due diligence and adhere to strict underwriting guidelines. Anzen employs an asset liability management framework to ensure the stability of USDz and sUSDz.
- Compliance: Anzen ensures that all backing assets and transactions meet the necessary regulatory requirements, integrating real-world asset yields into the DeFi ecosystem responsibly.
By integrating private credit yields with decentralized stablecoin technology, Anzen Finance is at the forefront of sustainable growth and innovation within DeFi.
Motivation:
This proposal seeks to onboard Anzen to the Curve Finance ecosystem, bringing both USDz and sUSDz liquidity to Curve. Inverse Finance and Anzen have partnered on the Aerodrome ecosystem for a long time, with DOLA/USDz being one of the largest pools on the protocol with up to $40k incentives pushed per week. Both Inverse and Anzen have agreed that Curve Finance on the ecosystem will be a better home for this pool for now, allowing for the utilization of Curve stableswap-ng yield-bearing tech for both protocols yield-bearing stablecoins. Both protocols plan to use CRV incentives to attract liquidity providers into the new pools, allowing for new growth, particularly for Anzen on Ethereum.
Specifications:
Please answer in a short and clear manner.
- Governance: Provide current information on the protocol’s governance structure. Provide links to any admin and/or multisig addresses, and describe the powers afforded to these addresses. If there are plans to change the governance system in the future, please explain.
Inverse Finance
Decisions for the DAO are made by using INV in the Governor Mills voting contract but as it takes a minimum of five days to vote through a proposal, Inverse Finance DAO has delegated decision-making power to several working groups with limited autonomy and budget. The scope of these working groups is determined in their proposals and they exist to meet fast moving market conditions, to transfer specific or minor decisions to relieve token voters from information overload, and to create a reliable and enjoyable work environment.
Working groups are held accountable to DAO governance, are required to produce progress reports and periodically apply for budget renewals. Delegates have insight into all discord conversations and working groups can be altered or disbanded by a DAO vote.
A detailed description of our governance can be found here.
Anzen
Anzen governance is operated centrally for now, with plans for an advisory board to be put together. The ANZ token has just launched, which implements ve-style voting system for deciding where future inflation of ANZ goes towards.
- Oracles: Does the protocol rely on external oracles? If so, provide details about the oracles and their implementation in the protocol.
Inverse Finance
The Fixed Rate Market or “FiRM,” is Inverse Finance’s Fixed Rate Market lending protocol. FiRM makes use of Chainlink price oracles or Curve’s ema, depending on the market, in combination with our native Pessimistic Price Oracle (PPO). This novel approach to price oracles for borrows and liquidations in FiRM uses the lower of two recorded prices: either a) the current collateral price on the oracle feed, or b) the 48-hour low price as observed by the PPO on the oracle feed, divided by the collateral factor. For example, if the current Chainlink price for wETH is $1,500, the 48-hour low was $1,000 and the collateral factor is 80%, the PPO returns $1,250. ($1,000 / .80 = $1,250).
Note: for some assets without a Chainlink price feed (such as cvxCRV, cvxFXS, INV), Curve’s EMA oracle (found in ng pools) is used instead.
Anzen
Anzen Finance does not rely heavily on external oracles, as the protocol’s stablecoin, USDz, is backed by off-chain collateral. The valuation and management of this collateral are conducted through rigorous off-chain processes and compliance frameworks rather than automated on-chain oracle systems.
Implementation Approach:
- Off-Chain Valuation:
Collateral backing USDz is sourced from private credit markets and undergoes detailed due diligence, underwriting, and ongoing monitoring.- Transparency Measures:
Asset details, performance metrics, and portfolio updates are shared through the Transparency Portal to ensure accountability and visibility.By avoiding reliance on on-chain price oracles, Anzen ensures the stability and security of USDz through carefully managed off-chain processes.
- Audits: Provide links to audit reports and any relevant details about security practices.
Inverse Finance
Inverse Finance has undergone multiple audits, including the likes of yAudit, Nomoi, Peckshield and DeFiMoon. Inverse has also hosted a bug bounty contest on Code4rena to conduct a comprehensive audit of FiRM, and has an active bug bounty program live on ImmuneFi. All relevant audit information can be found here. The DAO also has dedicated members overseeing risk, what we call the Risk Working Group.
Anzen
Anzen Finance prioritizes security and transparency, ensuring its platform and smart contracts are robustly audited by trusted third parties.
Completed Audits:
- Code4rena:
Anzen participated in a Code4rena contest, where its contracts underwent rigorous review by independent security experts.- ImmuneFi Bug Bounty Program:
Anzen maintains an active bug bounty program on ImmuneFi, incentivizing the discovery and reporting of vulnerabilities.Security Practices:
- Internal Reviews:
Anzen conducts internal security assessments for its smart contracts and operational processes.- Real-World Collateral Controls:
Since USDz is backed by off-chain assets, stringent compliance measures and regular audits of backing assets are in place to ensure their integrity and proper management.Transparency Reporting:
Anzen shares security updates and relevant audit findings via its Transparency Portal.
- Centralization vectors: Is there any component of the protocol that has centralization vectors? E.g. if only 1 dev manages the project, that is a centralized vector. If price oracles need to be updated by a bot, that is a centralized vector. If liquidations are done by the protocol, that is also a centralization vector.
Inverse Finance
The protocol itself is completely decentralized, and requires no human interaction to work as is. However, DAO working groups have been formed and are active in order to improve efficiencies is various operational areas within the DAO. Often, these working groups will have a Multisig wallet that the DAO governance awards certain roles and limited treasury asset allowances in order to carry out required work. All granted privileges and allowances can be reclaimed/disabled by INV token controlled governance. These are:
- Treasury Working Group (TWG): 3 of 5 Multisig with allowances giving access to Treasury funds to optimize treasury management.
- Risk Working Group (RWG): 1 of 3 Multisig with privileges to pause actions in our (now disabled) lending market.
- Policy Committee (PC): 5 of 9 Multisig that can change staking reward rate to INV stakers.
- Fed Chair: 4 of 7 Multisig with the operator role on DOLA Fed Contracts, which allows for DOLA to be expanded/contracted under the Fed smart contract logic (bounded by market conditions)
Please see our Multisig Wallet section of the transparency portal here.
Anzen
Anzen Finance incorporates elements of decentralization but acknowledges certain centralization vectors inherent to its design, particularly due to its focus on off-chain collateral.
Centralization Components:
- Collateral Management:
The valuation and management of USDz’s off-chain collateral are conducted by centralized teams and trusted partners. This process is necessary for ensuring compliance and managing real-world assets effectively.- Multisig Wallets:
Key protocol operations, including treasury management and emergency controls, rely on multisignature wallets. While these wallets require multiple signatories, their operation introduces a degree of centralization.Governance Delegation:
Specific operational decisions are delegated to working groups, such as treasury and risk teams, which operate under limited autonomy. These groups are accountable to the community through reporting and governance oversight.Decentralization Safeguards:
- Transparency: All centralized operations are documented and available through the Transparency Portal, ensuring accountability.
- Community Governance: Anzen’s governance structure empowers token holders to reclaim delegated roles or adjust working group scopes through on-chain votes.
While operational centralization is necessary for managing real-world assets, Anzen mitigates risks through transparency and strong community governance mechanisms.
- Market History: Has the asset observed severe volatility? In the case of stablecoins, has it depegged? In the case of an unpegged asset, have there been extreme price change events in the past? Provide specific information about the Curve pool: how long has it been active, TVL, historical volume?
The DOLA stablecoin is soft pegged to $1, and like fully decentralized, over-collateralized stablecoins, can experience some volatility around this peg. Larger deviations (below $0.99) often recover fast due to the repegging mechanism built into the protocol (increasing borrowing cost on FiRM, AMM Fed contractions).
USDz has operated with a tight peg so far, with no major depegs or volatility. ~90% of the supply is on Base at the time of writing.
