Disable USDN BR Protect mechanic

Ideas
1

The Problem

With the new multi-collateral system implemented, some of the existing protocol mechanics should be changed to enable USDN arbitrage.

What do you suggest changing?

The BR protection mechanics gets enabled when BR < 10%. As a result, USDN->WAVES swaps redeem WAVES and SURF tokens (instead of just WAVES) in proportion depending on the current BR value.
With the new multi-collateral system these mechanics is no longer needed because users are always redeem a set of tokens.

2

Please explain, how the new system makes tokens always redeemable?
Treasury has a limited amount of tokens. Even if the swap rate is lower, the treasury can be depleted. Adding more tokens doesn’t protect the BR to go to zero.
Against suggested idea.

1 Like
3
  1. br protection can be removed only if proposal about reducing limits will be accepted
  2. limits depend on BR, lower BR → lower limits, such setup together with multi-collateral can fully replace BR protection
4

Will the withdrawal from vesting be opened at the same time with this implementation?
If yes, it will bring down the price on USDN and BR, if not, it will be unfair to the VIRES users

1 Like
5

I have concern with #Idea 4. Isn’t this will create a negative impact to the multicolaterral asset? Because most likely, people gonna run from the ecosystem by selling it on the market. This will further lower the price of multicollateral asset.

I prefer to defer this Idea until we see how people behavior after application of Idea 2 and 3.
And I suggest team to explain about this idea #4 clearly. Is this Idea will affect SURF? Is this will not affect the collateral token? Because people tend to sell it right after swap the token.

I still don’t get the idea, why this will bring positive impact to the ecosystem. Team better explain how the USDN arbitrage work, and how this will have positive result to the ecosystem.