Ethan | CitaDAO
Create a CitaDAO AMO to provide liquidity to the Real Estate Token (RET) lending Pool, which will earn Frax non-crypto correlated yield and provide RET holders with the ability to take an overcollateralized loan with RET as collateral.
Background & Motivation
As Frax grows, it becomes increasingly important that its collateral mix diversifies into safe yield assets with interest rate revenues coming from non-crypto correlated economic activity.
CitaDAO is a decentralized marketplace for tokenized real estate designed to bring off-chain assets and the yield generation on-chain. At CitaDAO, we are building up our TVL of tokenized Real Estate. Our vision is to onboard billions of dollars worth of Commercial Real Estate on-chain and unlocks greater value for these assets. We achieve this by creating on-chain use cases/composability for tokenized Real Estate. For example, a primary use case of CitaDAO’s RET is collateralized borrowing. RET holders would be able to deposit their RET as collateral and borrow assets against their collateral.
- CitaDAO recently tokenized an asset worth over US$600,000, and we seek to unlock greater capital efficiency with the tokenized asset through a collateralized loan. Holders of this RET can take out collateralized loans against the RET.
- CitaDAO has a pipeline of commercial properties, with total value amounting to millions of dollars, to be listed on our platform. We believe that a partnership with Frax would allow us to continue to access the true potential of Real Estate together.
We propose creating a CitaDAO AMO that provides collateralized debt to RET holders. This would generate yield for Frax that is uncorrelated with the rest of crypto, while providing liquidity for real estate token holders. We propose the authorization of up to $2m worth of liquidity for use in the AMO as a Proof-of-Concept (PoC). Subsequently, as CitaDAO continues to build up our TVL, we will request a larger authorization amount.
Risks / Structure / Protections
- CitaDAO is currently at its infancy stage with $600k TVL, and scaling up with real-world assets is slower than the typical crypto project.
- CitaDAO’s smart contracts have been audited multiple times by ABDK
- Each real estate has its respective off-chain income. The income varies by real estate, but the IRO process allows the community to decide if an asset will eventually be tokenized.
- We are integrating with Chainlink for an oracle that provides valuation of the tokenized real estate. This creates a reliable and transparent price feed for the real estate IRL.
How Does This Benefit Frax?
- Grow the TVL with a safe, attractive yield that is truly uncorrelated with the rest of the crypto markets. Real world asset can help increase FRAX TVL uncorrelated to the crypto volatility.
- Diversified and scalable source of income - Each real estate tokenized will be a standalone asset. As more listing comes on chain, the demand for FRAX would also increase and hence help to create a sustainable source of alternative income for the protocol.
CitaDAO is a marketplace for tokenized real estate that allows real estate owners to list and tokenize their commercial Real Estate. Introducing Real Estate On-chain (IRO) is a process where the community decides if the Real Estate gets tokenized.
Participants can participate in the IRO by contributing any amount of stablecoins to the IRO. A successful IRO leads to the tokenization of the Real Estate asset into Real Estate Tokens (RET). The RET is ERC20 tokens distributed to the crowdfunding participants on a pro-rata basis.
More information about the IRO process can be found at https://docs.citadao.io/intro/how-iro-works/overview.
Yes: Create an AMO for CitaDAO as a PoC.
No: Do nothing.