Creating a post here to kick-off discussions around PCV diversification for FEI PCV.
PCV diversification seems to be a good strategy that aligns the interest of both FEI users (stability) & TRIBE users (pcv value is locked on a base layer of tokens). Additionally, I feel like its’ very important that TRIBE is able to preserve PCV value while FEI stablizes. As it stands PCV volume has a very high intrinsic value and more impactful than any 30-40% collateraization ratio changes and its important that we not give that away as we move towards FEI stablization with reweights & auctions.
- Helps lock down PCV value (there by providing incentives to arbitrageurs for stablizing FEI).
- Helps decouple specifically against ETH volatility
- Additional diversification opportunities to farm governance token of symbiotic projects
- Better optics on bear market as effectively prices required for sub 100% collaterization will be very low.
- Upside of ETH is not captured as PCV value
- Additional risk of multiple projects
Poll: Here’s a quick poll to get an initial view of what general sentiment looks like when it comes to pcv diversification (Only blue-chips projects (btc/eth) & stablecoin (usdc) has been included):
PCV Diversification Ratios:
What should be pcv split ratios?
- ETH 100%
- ETH 75% USDC 25%
- ETH 50% USDC 50%
- ETH 50% USDC 25% WBTC 25%
- ETH 80% USDC 10% WBTC 10%
- ETH 75% WBTC 25%
- ETH 50% WBTC 50%
PCV Diversification Timing
When should PCV Diversification occur
- Along with FIP-3 (reweights/DI re-open)
- After FIP-3 is implemented
- In place of currently planned FIP-3 (instead of reweights/DI re-open)
- PCV diversification is bad
- Lets hold off on this until EIP-1559!