Discussions for #p5: UMA token treasury management

Every week, we receive $UMA tokens from the developer mining program of UMA.

They are received in the treasury: you can follow the treasury address here.

For now, the UMA tokens are being used to farm SUSHI (we sell 50% of them for ETH, and deposit them into the Sushiswap UMA-ETH liquidity pool).

So far 5 options have been discussed, and this forum is here to discuss these options, or to add more. If you present a new option, please explain the pros, cons, additional yield, and any additional information.

:one: Sushiwap
:two: Baoswap
:three: Umanji
:four: Unit
:five: Alpha Homora
:six: Sell UMA for other assets that could bring higher yield

:arrow_right: we made a table to compare the strategies, APY, pros/cons, etc. You can see it here: https://drive.google.com/file/d/1urAKgnwzfzwOX6_6SqJjM3DYpdVdDTSB/view?usp=sharing

:ballot_box: The voting will be done later this week, the point now is to discuss, educate, so people can vote with as many information as possible.

7 Likes

Alpha homora option looks the best in terms of APY without lock : 80% with 1.75x leverage. It requires to survey liquidation if UMA drops too much against ETH (we believe Pascal is good on this kind of stuff), and a plan B if it’s happening.

I did not understand well, but I understand that the part “for” brings more performance to the DAO.

What I would like to know, we are talking about UMA, but I don’t get any. Is it a vote only for those participating in Sushwap ?


Moi je n’ai pas bien compris, mais je comprends que la partie “pour” amène plus de rendement à la DAO.

Ce que voudrai savoir, on parle de UMA, mais moi j’en reçois pas. C’est un vote uniquement pour ceux qui participent dans Sushwap ?

Bonsoir Ă  tous,
C’est chouette d’avoir mis en place cet espace afin de pouvoir mieux comprendre les orientations que nous sommes amenées à décider tous ensemble.
Il me semble avoir compris qu’il soit absolument nécessaire d’augmenter au maximum la trésorerie se trouvant dans la DAO sur les mois avenir.
Perso, je fais mon maximum pour vous suivre quotidiennement sur le forum, mais c’est parfois difficile de concevoir l’ensemble de la mécanique.
Pourrions-nous avoir un choix numéro 7 qui serait l’avis de Pascal.
Et/ou un choix numéro 7 donnant procuration à Pascal (ou à l’équipe)
Personellement, je trouve que Pascal est le plus amène d’avoir suffisamment de recul sur les différentes stratégies pour suivre sa vision pour la bonne marche de Jarvis.
Surtout au tout début !!!

4 Likes

LP is not ideal with classic current xy=z curve pools, inducing impermanent losses (IL) hardly predictable and not compensated by high trade volumes (only stable coins are gathering highest volumes).
Yield should give significant compensation to tackle that. Even 3 figures yield couldn’t suffice.

So I would split K in 3 equal parts (33/33/33) :

To be still exposed to UMA (and not dump too much token) > 33% of total to LP Uma in Alpha Homora

For a Degen yield :
33% buy of EPS token (Ellipsis is a curve AMM like on BSC) LP EPS/BNB pancake and farm LP with beefy (1% daily /3660 yearly - no vest period - IL risk is compensated)
https://app.beefy.finance/ (with BSC main net RPC setting)

For safety (and more link to Euro exposure - might it be of interest for jEUR in the future ?)
33% buy of EURS (or sEUR) > LP passive EUR strategy on StakeDao (aggregation of Curve EURS pool) > Farming of Stable euro 24% APY
Overview | Stake DAO (ETH main net RPC setting)

Another option would be to farm LP token @54% Apy in collecting SDT > could be staked as xSDT (+27% apy vs SDT + vote power) > then xSDT to Palace (points for nfts with special rewards function but in counterparty loss of voting power)
https://stakedao.org/lpfarming

Pros:

  • Diversification to fight IL risks on a simple UMA LPing
  • High yield strategy on BSC from a Curve finance simpler copycat.
  • Low risk passive strategy in EURO (strongest current stable coin at the moment) allowing a “Buy the Deep” if any opportunity,
    OR betting on SDT token future upside with higher yield (24% in Euro only vs 57%+ with SDT/xSDT)
  • Each leg weights (33/33/33) could be modified and rebalanced

Cons:

  • Dump of UMA tokens
  • Degen mode strategy (EPS) might decrease overtime, needing active management and scrutinity

NB:
Another potential leg (so 25/25/25/25) without market risk would be to migrate some funds to Aave Polygon and benefitting from 1 year MATIC tokens rewards for Liquidity deposits (feedback loop possible = borrow and redeposit to benefit from Matic tokens rewards in both sides = get paid to borrow and redeposit !)
Providing USDT there could bring 25/30% being neutral to market (rewards in MATIC - token with good upside - attention: 1st reward decrease on mid of June, lower yield after)

2 Likes

I think we should choose 1
Seeking stable and long term income

I would like Jarvis to be an important player in the DEFI ecosystem. That’s why I think it’s better to focus on the token we want to farm more than the fiat return. So I’m more for a strategy that brings us protocol tokens that are and can be our partners. I prefer to farm tokens such as SUSHI, CURVE, UMA or any other protocol that can bring value to Jarvis. Personally I am not enough knowledgeable in Farming to propose one but on the 5 proposals SUSHI corresponds to my feeling (in BAOSWAP if we wish to go on Xdai).

2 Likes

I join MIKAELUS with a new option, white vote, which will allow to detect those who do not have an opinion and which includes those who do not understand everything or even nothing.

It is not for the farming program participants, it is for the governance’s treasury. JRT = you own part of this treasury, so the idea is how to maximize it.


Ce n’est pas pour les participants au farming, c’est pour la tresorerie de la gouvernance. JRT = tu possedes un % de cette tresorerie, donc l’idee c’est comment maximiser cette tresorerie.

1 Like

English sir :slightly_smiling_face:

I prefer to do not give my opinion now, because I want to see what the community thinks. It is a way for me to analyze the level of the community regarding treasury management, knowledge about the protocols, etc.

1 Like

Everything you said makes senses, the only issue for now is the gas :slight_smile: (ofc not an issue for BSC and Polygon).

Diversification will be good in few weeks/months when the treasury grows to 500k-1M, so we can launch +$100k farm and offset the gas fee after a few days of farming.

For now with a limited capital, I think it will be less capital efficient to split our funds to many farms.

For ex StakeDAO would cost around 100-200 usd to deploy the strategy.

Well put. CRV will be the more important btw.

Hi Pascal
How much money will the DAO fund start with?

New idea:
Curve. Fi on Polygon > stable usdt farming @75% +~11% matic
Almost risk free
CRV is foreseen to be added as a reward

Costs: the bridge then swaps almost free on Polygon

Ave Senatores,

I agree with MarcG but as I’m not a fan of the 3y lock of Baoswap, I’ll go to Umanji option.

I’m ok with all the strategies except Baoswap. But I don’t have the vision to see which one is better.
As mentioned above, I think it would be a great idea to start cumulating StakeDAO tokens (SDT) and CRV too.

1 Like

Keep farming SUSHI in order to sell half of it and LP the other half sounds logical. Would also be interesting for the DAO to receiving some CRV as it seems to me that we would be almost risk free (the CRV tokenomics are awesome and the token price seems almost certainly promised to a very bright future).


Continuer de farmer des SUSHI pour en vendre la moitié et fournir des liquidités avec l’autre moitié semble logique. Il serait aussi intéressant pour la DAO de recevoir quelques CRV car il me semble que pratiquement sans risque (les tokenomiques de CRV sont fantastiques et le prix du token semble presque certain de connaître un avenir radieux).

1 Like

instead of choosing one of these options. should we delegate that to a treasury manager for a limited period of time that will define this strategy ?

Could we trust anyone else than Pascal? Not sure…
I agree for Pascal, if it would be an option

1 Like

I am in favour of the current set up. LP uma-eth. It helps support uma which is where the rewards are coming from and so helps uma be worth something in the first place. This is a positive feedback loop between Jarvis and UMA.

I understand the lure of high apy and low gas, but bsc is unnecessary risk imo, from the meme-coin farming up to the whole operation. the gas limits on bsc doubled the past month, is everyone not just expecting it to implode?

i’m not against curve on polygon that could be good too, it might help establishing somewhere jarvis would like to call its L2 home. Im not sure of jarvis’ L2 plans but it makes sense to move funds to the L2 that might be where jarvis also ends up, keep liquidity in our own neighbourhood.

but i prefer to keep things simple and support the current sushi uma-eth LP position.

you can track DAO on Zapper, Zerion, … on this adress: 0x8ef00583baa186094d9a34a0a4750c1d1bb86831