Context
Lido is a liquid staking solution for Beacon chain backed by industry-leading staking providers. Lido lets users stake their ETH - without locking assets or maintaining infrastructure - whilst participating in on-chain activities, e.g. lending. When staking with Lido, users receive stETH tokens which are issued 1:1 to their initial stake. stETH tokens can be used as one would use ether, allowing you to earn Beacon chain staking rewards whilst benefiting from e.g. rewards across decentralized finance products.
Two of these decentralized finance products that allow you to use your stETH are Curve and Convex, two staples of the industry. Abracadabra has a strong history of working with Convex-boosted Curve LP tokens such as: cvx3pool, cvxtricrypto2, and the recently deprecated cvxrenBTC.
Motivation
Abracadabra is a fast-growing multichain protocol that would benefit from an additional ETH staking vault, in addition to the current vault, yvcrvSTETH. cvxsteCRV is important to hedge against the risks of other ETH staking services (particularly because of its decentralized nature) and will be an important addition to the DeFi space in general. Currently, the cvxsteCRV pool has ~$470m of TVL, which would be a nice addition to increase the supply of MIM and produce more value for SPELL holders.
Adding cvxsteCRV would add another strong collateral position to back MIM, which should be of utmost importance after the UST and FTT debacles.
Proposal
Allow cvxsteCRV as collateral with the same pool specifications as yvcrvSTETH (Maximum collateral ratio 75%, liquidation fee 12.5%, borrow fee .5%, interest .5%)
Benefits
- Diversified risks and adds an additional option for ETH stakers/LP providers who would like to access liquidity using Abracadabra, which in turn increases the supply of MIM.
Considerations/Risks
cvxsteCRV LP position holders are exposed to smart contract risks on Curve and Convex, primarily.
Links and resources
cvxsteCRV contract addresses
LP token address: 0x06325440D014e39736583c165C2963BA99fAf14E
Deposit contract address: 0xF403C135812408BFbE8713b5A23a04b3D48AAE31
Rewards contract address: 0x0A760466E1B4621579a82a39CB56Dda2F4E70f03
