deployed to other protocols like Curve to generate returns, and if the collateralization rate drops, USDC is returned to FRAX treasury?
Yes if the peg needs to be maintained the deployed USDC is returned to normal
Is there a minimum guarantee threshold in USDC?
Can you elaborate what you mean by minimum guarantee ser?
for example, the FRAX must be collateralized by at least 80% USDC. is there a threshold like this?
We have a collateral ratio which states the percentage of USDC. https://app.frax.finance/ Currently 94.25%
is there a minimum ratio?
* or a goal to maintain
This is the goal to maintain, however after a governance vote, the CR will soon be 100%
ok thank you, for the moment the objective is to maintain at around 94%
Thanks you for help
sorry for an additional question, can you explain this passage to me or just give me an exemple.
It means AMOs function while programmed to not affect the peg
Still remember I asked the same question here when AMO doc. came out
To be fair, the goal is actually to increase this from 94% to 100% by diverting protocol revenues towards CR instead of buying back and distributing FXS to veFXS holders.
Ok I understand thanks 🙏
Once CR reaches 100%, we turn the veFXS money printer back on 😉 If the last months protocol revenues continue, we should reach 100% in 2-3 months. Then that revenue will re-start the FXS flywheel and should increase interest in locking veFXS again.
All right. I read the documentation little by little I haven't yet arrived at the details of FXS and veFXS. from what you tell me, the fees generated by the protocol are used to buy FXS and distribute to veFXS holders
Right, but this feature is off right now since the DAO voted to direct all revenues towards CR in order to remove the algorithmic backing of FRAX.
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