Proposal to add the sDOLA / yUSD to the Curve Gauge controller on Ethereum

Gauge Proposals
#1

Proposal to add sDOLA / yUSD Gauge [ETHEREUM] -

Summary:

This is a proposal on behalf of Yield.Fi & Inverse Finance to enable a gauge for yUSD / sDOLA on Ethereum.

Yield.Fi is the World’s First Onchain Asset Management Platform focused on creating liquidity, flexibility, and high returns. It allows users to seamlessly stake, hold, and deploy its yield bearing stablecoin - yUSD across bluechip DeFi partner protocols, earning both passive APY and additional rewards.

Key features:

  • Multichain approach - Live on Ethereum, Arbitrum, Optimism, and Base with more upcoming
  • Accepts - USDC / USDT and more stables in deposits
  • On-chain trackable Daily compounding rewards.

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.

Relevant Links:

Yield.Fi -

Inverse Finance -

Motivation:

Yield.Fi & Inverse Finance aim to enable a gauge for yUSD/sDOLA to substantially increase the liquidity of yUSD & sDOLA, while supporting its utility and viability for integration into a range of DeFi protocols.

Specification:

1. Governance:

a. Yield.Fi will set up a DAO mechanism with its governance token in the near future post the launch of the token. DAO members and token holders will be able to vote for strategic token emissions to DeFi opportunities

b. Inverse Finance -

1. 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.
2. 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.
3. A detailed description of our governance can be found [here](https://www.inverse.finance/blog/posts/en-US/all-about-governance-at-inverse-finance).

2. Oracles:

  1. yUSD -
1. Ethereum

  1. Pyth (pull) - https://www.pyth.network/price-feeds/crypto-yusd-usdt-rr
  2. Supra (pull) - https://supra.com/data/details?instrumentName=yusd_usdt
  1. sDOLA -
1. 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).
2. 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.

3. Audits:

  1. Yield.Fi has undergone security audits and checks to ensure the safety of user funds. Audits | YieldFi
  2. 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.

4. Centralization vectors

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

yUSD is controlled by 0x7c2c44a988E0B74bcaE644fC8cD1200fcF727001 which is a Contracts admin multi-sig address with 2/4 control which is currently held by the team. The access to this multisig will be decentralised to the community / key industry players in the coming weeks.

  1. Market History: No major volatility in deposits across protocols.

For:

Yield.Fi & Inverse Finance will be incentivizing yUSD/sDOLA Curve LP on Ethereum through a Boosted Yield Crumbs and rewards and has seeded liquidity through its treasury on both pools. The pools will be scaling in liquidity depth once the gauge is approved and incentives are flowing in.

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