Yes, I am only talking about 8X.
Its turning a delta neutral vault (ie no risk) into a risky investment. That is a major change in the whole mandate of being delta neutral…
Yes, I have the same question. And further more, please clarify how you come up with this 200M TVL limit. What are your assumptions, how you calculated, etc.
very good advice ! I think I will choose Option#1: Linear allocation because it encourages whales to lock some xalpaca,and it helps alpaca price up. Only attract whales participate in av , alpaca could be known by everyone like curve.
Excellent initiative !
Limiting the deposit on x8 AV to xAlpaca holders gives a lot of value to Alpaca holders.
The demand for these AV far exceeds the supply:
I am an alpaca fan, I own Alpaca, I have Discord notifications enabled and yet I have not been able to get into the 8x AV. It sold out in less than 10 minutes.
On the side, I have friends who don’t care about the Alpaca token, but are also on the lookout to get in on these AV 8x.
If owning Alpaca and making the painful choice to block it, gives me no comparative advantage over someone who doesn’t care about the Alpaca token, that sucks. Just like the UNI token…
There’s no room for everyone:
So, no Alpaca skin in the game, no AV 8x. Easy and fair
Only people who don’t want to own and stake Alpaca take offense to this.
But all Alpaca holders will love it.
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To answer the question:
I prefer option 1, linear.
I don’t see the point of creating threshold effects?
Subsidiary question:
Is the ratio of 2 xAlpaca = $1 allocation fixed?
Currently it corresponds more or less to a ratio of 1$ in xAlpaca for 1$ allocation in a pseudo delta neutral strategy.
But if the price of Alpaca appreciates strongly, which is not unlikely at all, and this ratio of 2 xAlpaca for 1$ allocation is fixed, we will quickly find ourselves with ratios of 4$ blocked in xAlpaca or more for 1$ AV 8x allocation… won’t this end up being prohibitive?
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It is possible to make a proposal ? on snapshot ?
I didn’t realize people are supposed to discuss in such a rude way. Bye then.
You can see how the ~200 Mn TVL estimation is calculated here:
The 200 Mn is debt + equity. So the total amount that can be invested will depend on the vaults’ leverage level.
It’s a high-level estimate and the actual capacity will depend on the underlying pools’ APR at the time of deployment.
2 Likes
For #2.
Sharpe ratio measures return per unit of volatility. Increasing the fee doesn’t change return’s volatility.
Volatility is driven by asset’s price movement. You might be confusing it with some other metrics.
1.) When you make an investment in a vault, you receive a share token … e.g., n3x-BNBUSDT-PCS1. If we were to use the token balance in users’ wallet to determine if he has used up his allocation, one can easily game the system by investing and then transferring the token to another wallet and repeat.
2.) Each vault has its own associated set of smart contracts. They operate independently. So it’s not possible to check the amount across all Vaults.
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I believe that’s incorrect. The borrowing interest factor affects 3x and 8x in equal proportion.
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You can make a proposal to change the fees.
The allocation is for each vault instance. If you have 2 xALPACA, you will get $1 allocation in each vault instance which are currently capped at 25Mn
The TVL/capacity on the UI includes borrowed assets
I think your math is off.
1.) if all of the $200 Mn capacity is 8x, the equity required = $200 / 8 = $25 million which means 50 million xALPACA.
2.) Also, as stated in the proposal, 2 xALPACA gives you $1 allocation in EACH vault.
There is much more demand now relative to supply of AV. So if some people don’t want to hold ALPACA to get access to 8x, they can use 3x if they want. We don’t need to care about if holding ALPACA is consistent with some ideology or product description. We only need to care that the 8x capacity is filled.
There are already enough xALPACA stakers to easily fill it. With this proposal’s parameters, only 15.6% of current xALPACA(40Mn) needs to take up their max allocation to fill a 25Mn 8x vault, and that’s if 0 new ALPACA is locked to use AV.
The user has been suspended for rudeness.
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We can always adjust the parameters in the future.
Anyone can make a proposal and it has to go through a few stages to reach snapshot. The proposal process involves first making a post on the forum to garner support on an idea.
https://forum.alpacafinance.org/t/how-to-develop-a-community-proposal/36/2
Really interesting,
taking for exemple the BNB-USDT vault on PCS,
if we keep with two different leverage strategies x3 and x8, and if we continue to split 50/50 between them :
I understand it will open for 31.45 millions usd equity deposit on AV x3 and 11.79 millions on AV x8
This is the new money inflow in the LYF
And taking into account the leverage, which is borrowed from the lenders, mainly in BNB less in USDT, it represents the addition of $94M in TVL for each vault.
I’m curious, how do you think it would impact the Alpaca lending market, notably the usage ratio of BNB if the AV are sold out ?
On the xAlpaca requirement, would it mean that 188M xAlpaca would be necessary to sold out the AV x8 BNB-USDT on PCS at full estimated capacity ?
I have a simple question :
If I deposit from my wallet 10,000 USDT on AV x8 does it count as an $80,000 increase in TVL ?
And following the new rules (option 1 linear), I would need to have 160k xAlpaca to proceed, correct ?