Hey everyone,
Pablo from Angle Protocol and co-author with @tuta of the Angle Incentive proposal.
I’d like to give some updates about the state of Angle incentive proposal.
Angle Project Update
First on Angle and Optimism. The protocol was just deployed on Optimism: it is now possible to borrow agEUR for 0.5% a year on Optimism against ETH and USDC.
New collateral types can easily be added so we could technically support OP for instance.
Everything happens here and the smart contract addresses can be found here.
To start creating flywheel effects, the protocol has seeded a $400k pool with USDC and agEUR on Velodrome and acquired 2m VELO tokens (for $90k) locked for a period of 4 years.
agEUR is therefore a liquid Euro stablecoin on Optimism, and it’s now easy and super cheap to get leverage on ETH or on USDC through Angle protocol on Optimism thanks to the seeded agEUR liquidity.
Updates on the proposal
Number of OP tokens requested: 250,000 OP
We propose to reduce the number of requested OP tokens from 500,000 to 250,000, and leave us the room to apply again for 250,000 additional OP (or what’s necessary then) when we have more evidence of our success.
TVL on Optimism: Official announcement has not been made yet but 200k agEUR have already been brought to Optimism, and the protocol has already committed more than $500k to the Optimism ecosystem.
How will the OP tokens be distributed?
Based on community’s feedback on the proposal, especially about the fact that LPs can be mercenary.
Following up on @tuta’s comments, growing liquidity is essential for Angle product to be attractive: otherwise there’s no point in getting leverage on agEUR, and we’ll slowly and smoothly decrease OP rewards so that in the end APY comes mostly from fees of people using the pool to sell agEUR to get leverage or to buy agEUR to repay their debt.
What we propose as well is to amend the reward smart contracts to propose a lock to LPs: idea is that LPs which are locked for a certain amount of time (up to 1 year for instance) receive more rewards than those that do not lock.
On top of that, to make the distribution clearer, what we propose is the following:
- 80% for agEUR liquidity on Optimism (spread between Velodrom - agEUR/USDC to start with- and Curve)
- 20% for bounties and teams building on top of Angle on Optimism
Over what period will the tokens be distributed
1 year
How much will the project match in co-incentives
The project has already bought some VELO tokens to incentivize liquidity on Optimism. We will keep voting for our Optimism pools with these tokens and make sure that VELO rewards are higher than OP rewards distributed to LPs. Based on the different token prices, we may include some ANGLE rewards to make sure there’s always more than 1$ of non-OP reward for each OP reward that’s distributed.
On top of the incentives, should the proposal be successful, we propose to facilitate the adoption of OP on Angle protocol and facilitate the introduction of OP as a collateral to mint agEUR.
Angle low interest rates (0.5%) would be the smallest ones possible for people to borrow against OP.
This will allow among other things OP holders to mint stablecoins against their OP (rather than having to sell it) or to get leverage on their tokens (using the agEUR-OP liquidity we would be building).