Tribe x Yearn Finance DAI Strategy

Currently, B. Protocol’s implementation of the Liquity stability pool offers an 8.34% APR, which would be diluted to 5.45% if 100M additional LUSD was added. Yearn’s DAI Vault currently yields a small interest rate of 2.18%. If the Tribe DAO borrowed 100M DAI from this Yearn vault, we could exchange it for LUSD (via OTC is the only way I can figure as of now). Then we can use this LUSD to farm the stability pool, returning 2.5%~ to them (swapped back to DAI), and keeping the 2.95% as profit. As shown by the image below, slippage for selling this LUSD is barely a problem.

Assuming we would pay 50 basis points in fees for selling the LUSD, and we could hold this position for a year, we would come out ahead 2.5m and would take on the risk that rates for DAI borrowing rise, though that does seem unlikely if the bear market continues. If we evaluate this opportunity on a risk adjusted basis, and from an opportunity cost perspective, there are higher leverage and better opportunities for the TRIBE DAO to spend its resources on such as TRIBE Launch, Turbo, VOLT, etc.


Would the Tribe team be open if a developer submits a grant to build Yearn like strategies for the Tribe Community and begin creating farming utility for FEI