This proposal is brought to you by the team at Vendor Finance(@vendorfi). We are a small team building a non-liquidation loans platform that recently launched on Arbitrum. We offer loans that do not depend on oracles and do not have liquidations on the terms completely dictated by the lender. For that reason lenders can pick any token for lending or collateral.
As a result of this proposal:
- LUSD will be listed as both lend and collateral asset on Vendor Finance on Arbitrum.
- 7,000 LUSD lending pool will be created against WETH on Vendor Finance on Arbitrum.
- LUSD and LQTY will be listed as both lending and collateral assets on Vendor Finance on Ethereum Mainnet.
Benefits & Impact
As an immediate result of this proposal, LUSD holders on Arbitrum will have one more potential application for LUSD. They will be able to underwrite the loans on the terms they would like which is equivalent to underwriting an option.
Also, the money awarded will work towards borrowable funds that Liquity community members could again take advantage of.
Once on mainnet, LQTY holders will be able to borrow against their holdings without the risk of being liquidated which is a powerful option to have. Additionally, revenue generated from lending those funds will help our team to continue building the vision we have identified for ourselves.
We believe that any additional utility that LUSD and LQTY can offer will only benefit the overall Liquity community. Here is just a few things that would be possible after integration with Vendor:
- WETH/LUSD pool for borrowers to borrow LUSD and deposit into the stability pool. They can maintain exposure to WETH while taking advantage of the stability pool rate (currently 10.26% LQTY APR). This will allow LUSD holders avoid liquidations.
- LUSD/USDC pool for “insurance” against significant LUSD depeg. By lending at high LTV and a slight premium one could offer LUSD insurance.
- USDC/LUSD pool for shorting LUSD to maintain peg stability when above $1.
This grant will also help our protocol develop and we would be extremely grateful for any potential partnership with a protocol of the scale and reputation as Liquity.
Scope & Delivarables
LUSD lending pool will be created against WETH and will last at least 2 months. We will ensure that the terms offered are acceptable by the market and funds end up being utilized.
We will incorporate the LUSD in our Arbitrum deployment as well as deploy the first pool within the first week of the proposal passing.
We should be able to list LUSD and LQTY on the mainnet within the 3 weeks of the proposal passing.
Ask & Payment
We are asking for 7k LUSD to be sent to our Arbitrum operations multisig: 0xa1a37072c6c127d3788ec2112bf154bca8da37b2
Discord: Vendor Finance