Title: Discussion About Adding TUSD Market to Fraxlend
Author(s): Anthias.xyz Team
Submission Date: 26 June 2023
Abstract
The following is a discussion around adding a TUSD market to Fraxlend in order to allow users to supply TUSD to borrow FRAX. The Anthias team thinks this market could prove valuable for Frax and thus would like the community to consider/discuss adding this market to Fraxlend.
About TUSD
Creators of TUSD (or TrueUSD), the TrueFi team write, “TrueUSD is a USD-backed ERC20 stablecoin that is fully collateralized, legally protected, and transparently verified by third-party attestations. TrueUSD uses multiple escrow accounts to reduce counterparty risk, and to provide token-holders with legal protections against misappropriation.” [Read more on TrueUSD Medium].
- Circulating Supply as of June 23, 2023: 3,140,888,017 TUSD
- [See CoinGecko]
- Market Capitalization as of June 23, 2023: $3,146,260,008
- [See CoinGecko]
- 24 Hour Trading Volume on June 23, 2023: $353,669,734
- [See CoinGecko]
The March 2023 Stablecoin Depeg
TUSD was able to remain fairly stable during the stablecoin depeg of March 2023 that was a result of the issues with Silicon Valley Bank. This is another potential reason that Frax community might want to consider when debating whether to add a TUSD market to Fraxlend or not. See the charts linked at the end of this proposal that show TUSD’s price action in March of 2023 compared to the stablecoin with the largest current market capitalization as of June 23, 2023: USDC. [Note: Multiple media embeds cannot be included in a proposal, so we collected the imagery in a Google Doc and linked it below.]
Why Add a TUSD Market to Fraxlend Now?
Since the onset of 2023, TUSD has seen a nearly 16.5% increase in circulating supply, making the token more and more liquid as a collateral type. And in the past week, TUSD supply saw a near 50% increase in circulating supply from just over $2B worth of TUSD to just over $3B. See the charts below for visualizations of TUSD’s rise in adoption and circulation since the start of 2023.
Demand on Other Borrowing/Lending Platforms
The TUSD market on Aave V3 on Ethereum is currently nearing an 87% utilization rate, which displays the user demand for a market for TUSD. The Anthias team would like to see if the Frax community sees an opportunity here to gain some of that market share for an apparently trending and “stable” asset (obviously, nothing in crypto is completely stable as we have seen too many times).
About Anthias
Anthias.xyz is a tool suite for easily monitoring liquidation risk for DeFi borrowing/lending markets. The Anthias team is composed of three members of the Dartmouth Blockchain club. Our philosophy is to continually provide value to the blockchain ecosystem through shipping useful products and research. The Anthias team has extensive experience in DeFi, having contributed at Yeti Finance, Primitive Finance, Temple DAO, and more. We have been awarded multiple risk management tooling grants from Euler, Aave, and Compound.
Conclusion
The Anthias team would like to gauge sentiment and hear thoughts from the Frax community with regards to adding a TUSD market on Fraxlend that would allow Frax users to supply TUSD. Please share thoughts/questions in the comments of this forum post, and feel free to reach out to 0xBroze (@0xBroze in Frax Discord or @OxBroze in Frax Telegram) with any questions.
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Charts and Graphs Referenced Above
Please see here for the various charts and graphs referenced throughout the proposal. As stated, Frax does not permit multiple image embeds to avoid spam, so we compiled the helpful imagery in this Google Doc.
Anthias.xyz Team