Add Concentrator aFXS gauge to the gauge controller
Background and Motivation
Concentrator is an auto-compounding vault system that helps farmers concentrate yields from multiple Convex vaults into aCRV and/or aFXS, then leverages auto-compounding to further grow those returns. Frax maxis can compound their FXS yield with aFXS which is backed by cvxfxs/fxs LP. Users can deposit with cvxfxsCRV, FXS and cvxFXS to aFXS compounder. When withdrawing, users can choose from cvxfxsCRV, FXS, cvxFXS, ETH and USDC.
Frax vault concentrating into aCRV has been deployed on Concentrator since the product inception, and depositors of the vault have seen consistent enhancement of approx. 20-50% over the existing APR offered by Frax vault on Convex. We believe that our Frax vault has and will continue to benefit Frax protocol and its community long term, because
- LPs of Frax vault can enjoy much higher yield, i.e. ~20-50% more on top of the existing APR from Convex.
- Auto-compounding by Concentrator effectively turns APR into APY without repetitive withdrawal / deposit operations, and hence improves users’ operational economics and efficiency significantly.
- Since the Frax vault on Convex doesn’t offer FXS reward, the auto-compounding don’t pose selling pressure to FXS
Soon Frax vault concentrating into aFXS will come to Concentrator as well.
Concentrator is built by the experienced AladdinDAO team. aFXS and all strategies offered on Concentrator have been audited and have never had any security incident since operation.
With addition to the gauge system, FXS holders will be able to earn the maximum FXS possible with aFXS. veFXS holders will also be able to boost their yields further. This is a strategy to reward the most loyal FXS holders.
We admire the vision and achievements of Frax, and see a great deal of synergies between our two protocols. In the future, we would like to continue working together with Frax and supporting each other in multiple aspects.
For: Deploy Concentrator aFXS gauge to the gauge controller
Against: Do nothing
First off I’ll say I like concentrator and the idea of aFxs is good as people could potentially farm on various Frax farms and have the fxs rewards compounding and gaining additional rewards. Seems like a good product to have.
That being said, my current thought on this is that creating a gauge for it might be a bit overkill. The idea of gauges is to increase frax (or other flagship products like fpi/fxs) liquidity or usage (lending based gauges). So I don’t really see the fit there as this is mostly focused on a derivative of fxs.
Gauging fxs derivatives is not completely bad but I think it should at least bring a bit more utility to the main tokens. Thus something like a fraxbp metapool of cvxFxs or pitchfxs or staxfxs would help the ecosystem out more.
Also for example, when non stable metapools are out for fraxbp (soon I hope?) Let’s say we make a cvxFxs/fraxbp pool and we gauge it for fxs rewards.
Then aFxs here could also be potentially farming that gauge underneath as well as have its own gauge. Then it becomes doubled up with multiple gauges for the same pool basically.
You can see aFXS (backed by Convex cvxfxs/fxs LP) as a compounding super charger to all Frax farms. To give aFXS additional FXS rewards will benefit the Frax ecosystem in multiple ways
1 Help to enhance the cvxfxs/fxs peg and deepen liquidity for Convex cvxfxs/fxs pool
2 Stronger cvxfxs/fxs peg will help more FXS to be locked into veFXS through Convex hence leads to stronger FXS performance
3 Stronger FXS performance will reduce bribe costs for Frax liquidity and better incentivize all possible use cases through Frax gauges
4 Additional FXS rewards will drive TVL growth for aFXS which will lead to higher harvesting frequency for the compounder
5 Higher compounding yield for aFXS will help to increase yield for all Frax vaults concentrating into aFXS
6 Higher yield for aFXS and all Frax vaults concentrating into aFXS will increase harvesting frequency for them all, in return improve yield achieved by all Frax farmers.
Flywheel takes off! This is a very high leverage play and everyone will be bettered off!
Hi Frax community, I want to say upfront that I am a member of the Aladdin team. Although this is a specific proposal for aFXS, I’d like to add some context that this is not a singular event for us. We consider Frax an important strategic pillar and intend to fully embrace Frax products. In fact, we have on our near-term roadmap plans for fraxbp.
We believe that the gauge would be beneficial as it would make aFXS more attractive, which in turn makes FXS more attractive as well as attracting more deposits into the upcoming Concentrator vaults that concentrate into aFXS. Basically, the flywheel.
We would of course be open to ideas and suggestions on how to tweak or add utility here. Ultimately, we want to help the Frax flywheel spin faster!
The issue is that this is a gauge for a FXS/cvxFXS base asset - for a gauge to be approved the asset needs to directly increase FRAX liquidity in the asset or pair receiving the gauge. You could propose a FRAX/aFXS pool for example similar to pitchFXS/FRAX which has already received a gauge
C2tP and Mark11, thanks for your comments. We hear your concerns on the requirement for a gauge to directly increase FRAX liquidity. This proposal is indeed focused on aFXS and we do believe that, in addition to reinforcing the cvxFXS peg, it would increase FRAX liquidity by attracting more depositors to Frax pools once we put them online.
However, that said, we are obviously going to respect any Frax gauge requirements. As mentioned, we do have a number of Frax-related items on the near-term roadmap so let us discuss this feedback in that context and think about what makes the most sense for us. Thanks for the discussion and we look forward to more in the near future.