PROPOSAL: Inverse Finance to enable stETH alongside ETH and incentivise stETH with LDO rewards

PROPOSAL: Inverse Finance to enable stETH alongside ETH and incentivise stETH with LDO rewards.

INTRODUCTION

Inverse Finance is an innovative DeFi protocol which launched in December 2020 with a unique fair distribution. A selection of cherry-picked DAO members were given a stake of at least 80 INV to help grow the protocol, taking it from a google form without any branding to where it is today. We boast an incredibly active, diamond-handed community, and a number of achievements in this short space of time.

GENERAL INVERSE HIGHLIGHTS:

  • INV was initially a non-transferrable asset before a tradability vote passed
  • INV DAO has achieved record-breaking vote participation rates (75%+)
  • Since launch Inverse Finance has:
    • 2,360 DAO members (on-chain holders)
    • Treasury assets worth $50m+ (as of writing)
    • Rapidly growing social presence & outreach including 10,000+ twitter followers and 3,600+ Discord & Telegram members
    • Features in popular outlets such as CoinTelegraph, The Daily Gwei, and social coverage from various influential DeFi natives
    • And other growth stats on Dune (search Inverse Dao)
  • INV DAO members (aka INVaders :space_invader:) are provably committed members with a large majority of original DAO members (409 O.Ds) remaining with the DAO despite the smallest initial distribution amount having reached over $166,000 USD at ATH prices, making it the second largest fair distribution to date after $MEME

WHAT IS INVERSE FINANCE?

Inverse Finance is an ecosystem of financial protocols and products (namely the Inverse DCA vaults, the Anchor Protocol and the Dola stablecoin).

DCA vaults: As a starting point, Inverse Finance is a yield aggregator (utilising Yearn Finance V2) allowing users to deposit stablecoins and earn yield in specific, chosen assets including ETH, wBTC, and YFI (with more to follow). This allows users to Dollar Cost Average (DCA) their stablecoin yield into riskier assets, protecting their principle while gaining exposure to volatility.

Anchor/Dola: Anchor is a new lending protocol based on a mixed synthetic/credit stablecoin (Dola). Comparisons can be drawn with MakerDAO or Compound, however Anchor enjoys some key advantages: on Maker, DAI cannot be used as collateral to take out loans on other assets; on Compound your borrowing credit cannot be transferred. With Anchor, both are possible.

This is a general summary, please see the Anchor/Dola section in our docs for a deeper dive.

PROPOSAL

We propose that Inverse Finance begins enabling the supply of stETH (as well as regular ETH) by individual suppliers who want to borrow DOLA against their ETH while simultaneously auto-swapping any supplied ETH for stETH (behind the scenes) collecting the rewards for our treasury, or other utilities. This will help drive stETH demand and growth while giving Inverse additional revenue.

Next to this, we would like to incentivise adoption of this supply feature by rewarding those who supply stETH with LDO over the course of X months distributing a pro-rata share of 500,000 LDO. This will encourage users to get stETH instead of regular ETH, in order to participate in Inverse’s Anchor Protocol, while discovering stETH and Lido DAO in the process.

POTENTIAL BENEFITS TO LIDO DAO :beach_umbrella:

:beach_umbrella: Increased awareness of & demand for stETH

:beach_umbrella: Increased awareness of Lido DAO

:beach_umbrella: Increased on-chain holders of LDO

POTENTIAL BENEFITS TO INV DAO :space_invader:

:space_invader: Additional revenue for Inverse treasury through stETH rewards

:space_invader: Increased overall ETH supply through incentivised stETH staking

:space_invader: Increased awareness through cross-pollination of two serious DeFi communities

RESOURCES

:space_invader: Website

11 Likes

YES! Been waiting for that proposal to happen. Good synergy :boom: :space_invader:

8 Likes

All for this! Let’s go!

8 Likes

Signed up to support this!

8 Likes

sounds like a great idea!

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Good idea, for two good project! Vote for Profit! :space_invader:

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Interesting to see $INV :handshake: $LDO :space_invader: :space_invader:

4 Likes

Let’s see how we synergistic together!!!

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This relationship could also create a precedence for 0 collateral DOLA lending from Anchor.

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INV is still a undervalued project. Lets have a thorough consideration and go for it !

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Two amazing projects!!! Let’s make it happen!

3 Likes

That’s a good proposal and I would love to have a vote on it, with some tweaks and questions:

  • we’d like to have a proposal for the first months of incentives (e.g. 100k for the first month), and then reconsider the amount based on the usage we see onchain
  • we would like to have a co-incentives campaign, where both our projects put some effort into promoting this new opportunity
  • what’s the technical solution to incentive scheme? is it synthetics-like mining contract or something custom? does it need additional development?
    @DeFi_Chad what do you think?
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Awesome. I love both protocols

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Always support :space_invader:

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INV <> LDO ftw :space_invader:

2 Likes

Fully support, potential increase awareness of Lido / additional stETH usage; additional revenue for Inverse treasury. Sounds good!

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At this point, we need to be pedal to the floor driving awareness for LDO & stETH. An opportunity to do that in partnership with a project like INV is a definite YES!

Let’s Get It.

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Let’s go!!! Can’t wait for this to happen! LIDO x INV

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Hi @vsh

Thanks for replying. Stoked that you like the proposal. As you can see INVaders are pretty excited as well :sweat_smile:

  1. I think doing it in stages could make sense if that is something you’d prefer. We could then adjust the following months rewards based on the previous months. E.g. if things kick off well then perhaps we can do a larger sum in the next month rather than need to do 5 votes. If it gets off to a slow start for whatever reason, we can reassess why and try round two with improvements.
  2. Cross-incentives and cross-promotion is definitely something we’d be keen to do and is essentially part of the proposal. How that would look could be discussed with your marketing team. We will naturally communicate the integration across our channels but perhaps we could do more. E.g. one of our core devs (maybe Nour if he is available but will need to confirm) could come on UpOnlyTV or we could do AMAs or whatever. Did you have anything more specific in mind for this?
  3. I am not a developer but I believe it will need additional development on our end. We would essentially enable users to deposit stETH, record those who do and have a contract that distributes a pro-rata share of 100,000 LDO per month to those who do. How we will develop the ETH-stETH auto-swapping in the background (so we can benefit from stETH rewards from those who still only stake ETH) I assume will require us to plug into a market, perhaps 1inch, and a contract which automatically converts ETH to stETH.

Our devs are currently working on some exciting stuff in the DAO but will try and get them to chime in here if you want to discuss the nitty gritty stuff.

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re: 1 The forum’s being invaded all right! The reason to start slow is that Inverse’s anchor is very green yet and it;'s better to see it stand the test of time for some time before allocating large sums for incentives.

re: 2, we would really like to get co-incentives going. Summoning @krasmussen for ideas on other marketing stuff.

re: 3, let’s talk on tg dev-a-dev, who do I contact? Nour?

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