Differentiated Yield bearing Stable Coin to take FEI to $100Bn in 1 year

Ideas
1

Fei – Differentiated Stable Coin to take FEI to $100Bn in 1 year

Making FEI an Yield bearing stable coin and let the yield be incentivized to bootstrap and scale the ecosystem

For FEI to survive and thrive, it needs to have the following basic characteristics:

  1. Peg remains close to $1, or FEI behaves as stable coin – Achieved (Still lot of optimizations being done to maintain the peg with as minimal PCV as possible, Capital efficient). The more capital efficient FEI algorithm becomes, the more scalable protocol becomes.

  2. Incentive for issuers
    a. Wide variety of bonding curves (Coming)
    b. Additional incentive for issuers (Currently Tether and Circle has incentives by generating yield on the assets being held as collateral and also Circle can offer integrations with payment providers etc.) – We need to think about additional incentives for issuers to increase the supply of FEI (Yield as an incentive for issuers)

  3. Incentive for users
    a. Just being a decentralized stable coin is not good enough – Incentive’s for users
    b. Ideally have more integrations to use seamlessly (Coming)
    c. Available on multiple blockchains (Coming)

  4. Incentives for integrations
    a. Yield sharing for protocols for integrating

  5. Generate or maximize yield from PCV
    a. 30% deployed in yield stable coins in Compound/Aave, Anchor Protocol
    b. 30% deployed in WBTC, DEFI Pulse Index and liquid staking protocols (Lido ETH instead of ETH)
    c. 20% deployed in Synthetic equity indices or FAANG’s
    d. 10% ($70 Mn) to be used for 100 startups that can increase the integration of FEI
    i. ~$0.5 Mn as seed money for 100+ startups including CEFI and DEFI integrations
    ii. Largest DAO and VC on Chain
    e. 10% deployed to Enzyme and other top performing asset managers

Incentive from Yield:

PCV from yield is distributing in the following manner

  1. 35% of yield to TRIBE holders, TRIBE burned from the market with yield
  2. 25% of yield to issuers (Additional FEI given at the end of every month)
  3. 25% of yield to users (Additional FEI given at the end of every month)
  4. 15% of yield to protocols based on usage

This way FEI becomes an yield bearing stable coin that automatically earns yield, without any smart contract interaction / gas fees for the average user.

· Higher utility for Users and Issuers → More FEI will be used
· FEI becomes more useful → More people will integrate
· More demand for FEI → More issuance as issuers also get yield sharing
· More FEI will be issued –> Higher PCV
· Higher PCV, more yield to be shared

This virtuous cycle creates, many positive effects and kick starts the lost glory for FEI. Unlike Fiat that depreciates every time a new dollar is created. FEI earns yield for its users and will become inflation proof true stable coin.

3 Likes