Content
@
0 reply
0 recast
0 reaction
onetruekirk.eth
@onetruekirk
Thinking about the possibility of first loss capital staking on @morpho. Would allow curators to cater to multiple tiers of risk preference in the same vault. An implementation of this would be an interesting subject for a grant
1 reply
1 recast
4 reactions
onetruekirk.eth
@onetruekirk
Idea for how it could work : Create a “peg stability module” where vault shares could be used to mint or redeem a deposit receipt at a fixed exchange rate. Holders of the deposit receipt stake-lock for a bonus share of fees. Vault users can opt in to the insurance pool by minting the deposit receipt. New mints allowed only if no bad debt has been realized (vault share exchange rate has not been modified since insurance pool has been created). If vault takes bad debt, users who opted into insurance and aren’t staked-locked can redeem in the insurance pool.
2 replies
1 recast
2 reactions
Tonyp
@tonyp
Another idea: You could front the Blue market with a tranching contract. Senior shares sacrifice some of their yield to the junior shares for taking the first loss. Given morpho socializes losses on bad debt liquidation, I think you could enforce the value of the shares on deposit/withdrawal
1 reply
0 recast
1 reaction
onetruekirk.eth
@onetruekirk
Doing it in between the blue pool and the vault is interesting, that could allow for vaults to share the insurance liquidity which is a nice feature, and maybe even for one vault to insure another 🤔
1 reply
0 recast
0 reaction
Tonyp
@tonyp
Yeah. You could maybe see someone like Gauntlet adding senior tranches of LRTs to their Prime vault and creating a high-yield vault to take the junior tranches. 🤷 risk never disappears, but you can move it around.
0 reply
0 recast
1 reaction
