Proposal to Deposit Liquidation Treasury Funds into Lending Pools

Simple Summary: Deposit and stake liquidation treasury funds as an additional source of income for the liquidation treasury.

Motivation: At the moment there is roughly $900k (mostly in stablecoins) sitting in the liquidation treasury. If this is staked, the liquidation treasury can earn roughly $63.83 per day (using the current APRs for each stablecoin), and increase the TVL by almost $1 million.

Rationale: Low effort low reward proposal, small increase in TVL and daily income for a few extra clicks per week. Will also marginally reduce interest rates especially for low liquidity coins like USDC, which may also encourage more LYF users, further increasing TVL. Importantly, this strategy incurs no risk to the initial funds.


  • Deposit all stablecoins (minus this week’s predicted buyback) into the lending pools
  • Withdraw the necessary amount for buybacks at the end of each week at the same time the tokens are sent to the Alpaca Deployer for burning
  • At the end of each week, withdraw the necessary amount for the predicted buyback of the following week, taking into account leftover stablecoins or new liquidation funds in the treasury. If there is a surplus, deposit the surplus stable coins into the lending pools and stake the ib tokens.
  • The same can be done with crypto such as BNB, ETH and BTC if the market picks up again and shorts are liquidated
  • Note: it might be worthwhile overestimating the required amount to ensure there is sufficient funds to buyback with without needing to withdraw multiple times per week



@cryptoeater Thanks for the suggestion.

This is a great idea, and something we can start implementing pretty quickly unless someone in the community has an objection / something else to add.


This fully defends the idea of ​​liquidation with liquidation. I am extremely disappointed. You can’t THAT change the rules of the game during the game. This completely changes the concept.

I strongly disagree with this idea. The liquidation treasury should only be used for buy back and burns of Alpaca as intended. The current strategy shouldn’t be tampered with. I think showing the platform is consistent with the way they do things is more important than using to treasury wallet to earn a few bucks per day.

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It will still be used for buybacks of Alpaca, the difference is that while the funds are not sold to buyback Alpacas they are doing nothing, with this change they will increase in value and with it buy more Alpacas in the end.


Well, what was the problem with buying back at 0.19 if the alpaca is deflationary and the team is confident in the product, even if the price falls at the moment of 0.1, the alpaca will still grow. Why not buy back the coins now and keep the burning coins on the wallet, or will we buy again at the very top?

They are buying at every 30min if not mistaken
So it does not spike the token out of proportions and keep buying them over time
If you take a look at the graphic it still show several spikes, if you just dump 900k USD volume at the same time it will be an anomaly and will need more liquidity.

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this is stupidity, when alpaca fell they didn’t buy it back, the liquidation was high and it didn’t affect the price and why is there any fear that buybacks will increase the price? as long as we see only this constant renewal of the bottom, I, as the owner, am not satisfied. It turns out I believe in the coin more than team. About 100-200 thousand coins are buyback per week. I don’t understend why team don’t wanna invest in Alpaca token. It already -98% from ATH

@Stars Being confident in the project doesn’t mean being confident in finding the bottom. We constantly receive comments like that and sistematically the price goes below what people think is the bottom. Also that’s totally unrelated to the OT so please use a different thread to talk about buybacks.

@cryptoeater I would avoid saying there are no risks involved, they are low but still exist

@huacayachief can we have a rough estimate of the ROI the lending would obtain considering the weeks left to burn all the liquidation treasury?

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a treasury wallet is not an investment wallet, when did a treasury wallet become a team investment fund? I didn’t find it in the docs. How can we even discuss this? The bottom or not, the bottom line is that when I came to the project in October of that year, I thought that buybacks from treasuries were going on constantly and there was no talk about sandwich attacks, let alone stretching buybacks, not about using these money for another purpose, I think it is the money of alpaca holders. Because that’s the only reason we can profit from this coin.

What you’re talking about is independent from this proposal. The thread starter is suggesting that instead of the coins sitting in BUSD earning nothing, to deposit them in ibBUSD so they can earn some interest while waiting to be liquidated. This proposal has no lockup or mechanic that would limit using that BUSD for buyback & burn.

If you want to discuss the rate of burn, you should to go this thread


I understand this very well, but I am against it, let them lie on the wallet and wait for ransom. potential income is too low

by writing a simple bot for buyback at RSI extremes, we could earn more than these ridiculous% I don’t understand what to discuss here.

Who is we in this scenario ? And what does earn mean specifically? Because the point of the liquidation treasury is to buyback and burn not for anybody to “earn”. It sounds very specific that you want the team to pump the token price so bad actors can game the liquidation treasury.

Additionally, setting parameters like those only allow bad actors to time their position and giving more opportunities to game the whole system.

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If it’s so simple to get money with that strategy write a bot and get rich, any strategy has risks and is not a guarantee of success.
Lending is a low risk low reward strategy that could also improve the utilization rate in lending pools, it would be more capital efficient for the platform to lend them.
My only question is if the low risk is worth the benefits.

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I don’t understand why everyone is talking about profit, we are not looking for profit using buyouts, the number of coins on binance is already breaking all records of more than 30 million, this has never happened before. Wouldn’t taking some of the liquidity out of the market reduce selling pressure? Using the RSI strategy, it was possible to accumulate more alpacas for subsequent burnings. I already wrote to Sam that by buying at 0.19 we will close the inflation issue until the end of the project, isn’t that the goal? Or now everyone began to look for profit from this wallet …

Maybe because you used the word “earn”? And you are suggesting to use RSI which then allow people to game the whole buyback and burn system which is to avoid the whole issue? Also you’re suggesting to buy back with a big amount each time, what’s stopping a bad actor to open a position before it reaches the point where I know a huge buy is coming in then sell after the buy

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People who are new to trading think RSI or MACD or Elliot Wave is some sort of magical indicator. The truth is if you backtest them, you’ll see results of like ~51-55% max and that’s only if you got a perfect entry, almost random. These indicators only work if you stack a bunch of them for confluence and really understand technical analysis to know when to use and when not to use them.

People have been telling us to use the liquidation treasury to buy the bottom every week since BTC was at like 50,000. Well, it’s only kept dropping since. Accept the lesson that it’s not that simple to call the bottom already and learn basic risk management, which is what we do. Let us do our jobs.


@Stars I understand the want to burn Alpaca faster particularly at these low prices, but we don’t know what the market is going to do next and we don’t know how low the token price can fall.

If you are right and the price only goes up from now, we may burn less overall but isn’t it good the price is going up? On the other hand, if the price falls we know we still have a constant weekly buy pressure from the liquidation treasury to help support the price.

If this continues to be a contentious topic, perhaps the team will need to create a new official discussion thread and eventually a proposal on snapshot to let the community vote.

With that being said, this whole discussion is off topic, please refer to this thread to continue discussing the rate of which funds in the liquidation treasury is used.

This thread is solely for the discussion of depositing stablecoins into lending pools, assuming the current model stays.


Good idea, it’s a win win situation more APY for lenders and more burns.