Frax + Lend Flare

Governance Proposals Token Swap / Seed funding
1

Summary

To establish a partnership between Frax Finance and Lend Flare. This proposal could potential help Frax investors to unlock their assets without losing any interest and maximize their yield.

Background

Lend Flare is a decentralized borrowing platform on Ethereum blockchain that allows Curve LP holders (the borrowers) to draw fixed-rate, fixed term and high LTV loans against Curve LP used as collateral, with no concerns for assets being liquidated due to price fluctuation. Loans are paid out through Lend Flare from Compound platform. Liquidity providers (the lenders) who deposit loan liquidity through Lend Flare on Compound platform will receive one of the highest interest rate compared to other current lending platforms.

Motivation

Frax has recently become one of the most influential stable coin in the market. Currently around 2876m sitting in Curve gauge. With Lend Flare, frax3crv holders can collacterize their assets in Lend Flare and borrow other stables against it without losing any Convex yield. With these borrowed stables, LP holders can reinvest in Curve gauge and further maximize your interest. Loops start. For details, please check twitter

With upcoming 4 pools, Lend Flare could help those who originally hold 3crv base and metapool LPs and further participating in 4 pool investment. Another loop.

Future Partnership Plan

  1. Adopt Frax as Lend Flare supplied asset. In other words, you can borrow Frax against corresponded Curve LP.

  2. A FRAX DAO <> Lend Flare DAO swap of FXS<>LFT and permanently lock each other’s tokens to align incentives.

  3. For Lend Flare v2, we will create a synthetic assets LFUSD and pair with Frax in Curve which further create loop for our loan suppliers.

Reference

Lend Flare Official Website: https://lendflare.finance

Lend Flare Docs: https://en-docs.lendflare.finance/

Lend Flare Audit Report: Lend Flare - CertiK Security Leaderboard

For: Lend Flare is a low risk, high LTV lending platform which could serve Frax community and help Frax grow.

Against: Lend Flare is still young. We have confidence that one day Lend Flare will become one of the most trustable and influencial partners for Frax.

Author

Lend Flare team

2 Likes
2

For: Lend Flare is a low risk, high LTV lending platform which could serve Frax community and help Frax grow.

3

For: unique use case, within the crv+cvx flywheel, and might be another great early bet for Frax.

4

Hey I think this is a great idea, although personally now I’m more weary with treasury swaps, we only have so much FXS available. I think we should just begin with adding Frax as borrowable asset and we make an AMO to seed Frax liquidity.

5

I don’t see anything defined for how much the proposal wants to swap gov tokens.
Nor why the gov token swap is a benefit for both platforms. What does frax earn from holding lft? What’s LendFlare’s strategy for wanting fxs?

Like there needs to be substantial reason for the swap and not just “to be partners” because you don’t need swaps to collaborate. (For example you could have frax borrowable and then FraxFinance be a large lender and provide liquidity at low borrow rates to increase lend flares usage)

6

Voted “Yes” with the assumption that this proposal is defined as:

  1. Both protocols do co-marketing and work together
  2. At some point in the future a swap proposal may be made (this current proposal has no such swap parameters)

Honestly wish this was rewritten to be more clear on what the proposal is actually doing. But with the above assumptions, signing yes shouldn’t have any negative consequences.

Since nothing is really defined (even with co-marketing aspect) this seems more like a temperature check than a full on proposal. But either way, glad to see the option of Frax borrowing and future possibilities.

1 Like
7

seems odd that the swap size was not mentioned in the vote

" 1. A FRAX DAO <> Lend Flare DAO swap of FXS<>LFT and permanently lock each other’s tokens to align incentives."