saddlefi

Summary

Launch 4pool on Evmos with SDL incentives, and deploy an additional SDL incentivized 4pool to ETH mainnet.

Abstract

This SIP seeks to modify the results of SIP-9 wherein the community voted to deploy a traditional 3pool to Evmos. Passing of this SIP will allow Saddle to launch on Evmos with a 4pool instead. This 4pool will be incentivized by 1.25m SDL tokens over 3 months, in addition to 250k UST provided by Terra. The pool may also feature DIFF and Evmos token incentives, pending further negotiations and governance proposals.

Additionally, passing of this SIP will approve a 4pool for deployment on ETH mainnet with 1.25m SDL tokens emitted over 3 months as liquidity mining incentives.

Note: The 4pool deployed on ETH mainnet would not be replacing the well established ‘SaddleUSDPoolV2’.

Background

Originally a collaboration between Terra Money and Redacted Cartel, 4pool seeks to dethrone 3pool as the primary stable coin pool across chains. Billed as a healthy balance between custodial and algorithmic pegging mechanisms, 4pool has gained significant attention from the community.

Motivation

DeFi evolves fast and in order to remain competitive, a protocol needs to adapt just as fast. The original motivation for SIP-9 stands– Evmos will mark the first major foray into EMV-compatible, IBC-enabled blockchains, allowing it to serve as an intersection between the fledgling Cosmos ecosystem, and the well established DeFi landscape of Ethereum.

The SIP would still see Saddle walk alongside Evmos as they usher in a new era of DeFi on Cosmos, and still see the protocol brought closer with the Nomad team– but it may now also come with incentives, and increased media exposure.

Terra has offered an additional incentive of 250k UST over the first 3 months; if Saddle chooses to deploy with 4pool instead of 3pool. This is subject to further increases depending on TVL at the end of the 3 month period. This also marks the first step in what is hopefully a long term relationship with a burgeoning stable coin provider.

Specification

Deploy a 4pool to ETH mainnet, and launch initially on Evmos with a 4pool– using Nomad to bridge ETH-native versions of USDC, USDT, and FRAX to Evmos. 1.25m SDL will be emitted over the course of 3 months, for both the Evmos 4pool and the ETH mainnet 4pool.

The first ~6 weeks of SDL tokens will be distributed as a non-transferable asset using Mini-Chef staking contracts. Post token unlock, Mini-Chef contracts will be swapped out for the gauge system outlined in SIP-8.

For: Modify the results of SIP-9 in favor of 4pool, and deploy a 4pool to ETH mainnet. Both pools will emit 1.25m SDL in liquidity incentives each. Deploy UST, Evmos, and DIFF rewards to the Evmos 4pool pending confirmation from the Evmos and Diffusion teams.

Against: No change.