I propose to bring the following topics for discussion.
Summary: things that I think will help Alpaca.
Abstract: suggetions about utility, buybacks and multichain I think can make Alpaca better.
Overview:
Utility:
I want to see more uses for the token.
All that I could find as a beginner was farms and governance with payments in Alpaca and partner tokens from grazing ranges.
I would like to see at least a small income in stables, for example in AUSD.
However, this may create selling pressure on the AUSD.
Buybacks:
We are deflationatory, YAY!
But as I see buybacks are not affecting the price.
After the appearance of the coin on Binance, the main volumes and liquidity are there, the possibility of shorting the token also adds selling pressure.
I believe that the low interest in the token and the small utility of the token make the token bearish in the current market situation.
I propose to transfer the buyback from DEXes to Binance.
We have a huge amount of coins, taking liquidity from there, it will be possible to reduce the pressure of the bears.
Multichain:
My personal feeling is that BNB is in a long decline right now, and I don’t see any movement that change this trend.
Accelerated deploy of the multichain and attraction of new users, that’s what the project needs so much.
However, is it worth spraying on the multi-chain and postponing other features?
Motivation:
With implementing this thing I believe that Alpaca will have an uptrend.
We originally did buybacks on Binance to get better rates and lower fees, but quite a few users complained that it wasn’t transparent enough, because noobs see an on-chain transaction to Binance and scream, “rugpull imminent” despite it being from the buyback wallet, and 50-100k size for a $1Bn TVL protocol which makes no sense. But this isn’t about speaking logic.
I read this thread and decided to add a little on my own, as an alpaca holder I also want to see its usefulness and I propose to exchange it for further minting of the ausd only for alpaca, no third-party tokens.
maybe instead of burning alpaca tokens it’s better to print ausd 25%-40% on them, in reality they will also be withdrawn from circulation, but this will be even more useful, maybe they can add strength to the stablecoin, these alpacas will forever remain in the backing of the stablecoin. ausd in turn add to the credits in the pools.
The money has to come from somewhere you can’t just mint some AUSD and distribute it. Something should be sold or locked to acquire the AUSD. While it can be annoying to swap partner tokens, money is still money. It doesn’t really matter in which form it is distributed as long as it can be swapped to your preferred form.
Let’s just keep it the way it is. Transparency is a bit more important than the small benefit that directly buying from a CEX gives. In the long run, if arbitrage happens it shouldn’t really matter where the buybacks are performed. The size of the buybacks and when they are performed is maybe a more interesting discussion
Personally I’ve never really trusted BNB so moving multi-chain was definitely a plus, but let’s not rush it. It’s been less than a week, we should strengthen our hold on each chain before moving to the next one. The aim should be to become a core component of each chain and make us irreplaceable (e.g., a “money lego” on which all protocols rely)
This. Instead of burning it, use it! Open an AUSD position with it and distribute the AUSD or farm with the AUSD(or busd after swapping) to further increase the buybacks.
What you’ve suggested is essentially a POL(protocol-owned-liquidity) strategy, like starting our own fund on top of the core business, but from my analysis, there isn’t enough benefit from such a thing at the moment to consider it. The resource cost in having to manage the capital to make meager returns is not currently worth the additional responsibility. Moreover, if the returns are coming from our own protocol then that would just be cannibalizing users’ yields.
at first, you can just add them to the ausd pool without printing to their stablecoin, there will be a large security buffer. in the future, according to the accumulation of these alpace, by voting in governance, decide what percentage of these tokens can be used to mint ausd. having such a buffer, it is safer to add new, more volatile tokens to the ausd pool.
Hey Sam! Yea we’ve had this discussion before (farming with burned token)
This time it’s a bit different, we aren’t cannibalizing any users’ yields just farming with USD/crypto. It also doesn’t require much additional effort:
don’t send the alpaca to the burner address but simply open an AUSD position with it,
swap it to any token (usd/ crypto/…)
3.A) deposit it in any third party protocol that accepts it
3.B) Or we could use it for the development/ incentive programs/ bribing/ rewards/etc.
To some degree, it also doesn’t matter which token it is; all profit is just additional profit that wouldn’t be made if we burned it.
the only downsides that I can think of are:
it indirectly takes away yield from users (e.g, user mints AUSD to farm in the same pool) but this is negligible. Where would you draw the line? you cant farm with it on the same blockchain alpaca operates?
requires some level of management to prevent liquidation, but this heavily depends on the collateralization ratio (can be adjusted by the “burn” from the next week for example). Beyond preventing liquidation the management can be kept to a minimum (e.g., adjust investment one a month/3-months/…). Again any profit is additional profit
creates some selling pressure on AUSD, but if AUSD achieves what it aims to achieve this shouldn’t be an issue
EDIT: opening a position does take away some of the lending rewards, but these a minimal and can easily be compensated (e.g, just return it to the pool) if even needed (1.3% is already close to nothing)
A. ALPACA will not have a high LTV for minting AUSD.
B. What you labeled as 3A requires a lot more overhead that you probably haven’t considered. What you listed in step 2 is just one of many. Again, what you’re suggesting is for us to act as a fund manager: deciding where to deploy funds, managing them, evaluating security, managing risk. Doing that in a semi-decentralized would be extremely resource-consuming, and doing that in a centralized way would create lots of additional overhead and potential legal ramifications down the road. That is not our core business and we’re not interested in spending our resources in this direction at the moment.
3B. Dev Fund doesn’t need this. And we can allocate funds for external programs from the Warchest.
What about the buyouts from Binance, on the last attempts at growth, we all saw what volumes there are and how the bears put pressure on the price of the coin, unfortunately it sets the pace and it has too many coins.
We’re talking about different things, I’m concerned about the constant selling pressure that comes with a lot of coins and the ability to short binance. It is necessary to bring this up for discussion and see who really “cares” about transparency, or is it more important for people to have large lump-sum buyouts that can be made on Binance, a lower commission, and, most importantly, a potential reduction in pressure on the price.
Liquidity in all markets is connected by arbitrageurs. Ignoring price impact, it does not matter where buying and selling happens. Price movements will echo throughout all connected markets. So there is no substance to saying buying on Binance will be more effective in counteracting selling pressure. Even if we bought on Binance, it’s not like we’d be placing limit orders to try to beef up the buy side of the order book, nor would it be enough USD to cause any change in sentiment.
The only positive effect would be getting better execution and thus having a bit more ALPACA from the buyback to burn.
(farming with burned token)