DIP006 – Proposal to Add New Assets and Strategies to Yield Markets

Summary:

With the growth of dForce’s TVL and the maturing of BTC and ETH lending markets, we believe adding BTC and ETH to the dForce Yield Markets would benefit our users by providing a wider variety of options. Currently, dForce Yield Markets predominantly supports stablecoins.

Once ETH and BTC are added to Yield Markets, users will be able to deposit ETH and WBTC into dForce’s Yield Markets. The yield market contract will manage and deploy the deposited assets to strategies on supported lending protocols to generate yields.

As dForce Lending nears launch, we also propose Yield Markets to add strategies supporting dForce Lending.

Background:

dForce’s Yield Markets is a yield aggregator designed to farm risk-adjusted yields across DeFi protocols with attractive returns. Instant deposit & withdrawal is supported. Tokens supplied into Yield Markets will be re-lended to supported lending protocols, which currently are Compound and Aave.

dForce’s Yield Markets now support USDx, USDT, USDC, and DAI. When users deposit supported tokens, they will receive corresponding dToken on a pro rata basis (i.e. depositing USDT to receive dUSDT). Each dToken represents a pro rata claim of the underlying token plus yields generated. Users can also participate in dForce (DF) liquidity mining by staking dTokens.

Proposal:

We would like to present the following proposals:

Proposal to add ETH and WBTC to the list of assets supported on Yield Markets, so users can easily deposit their ETH and WBTC and earn yields generated from underlying strategies.

Yield Markets to add new handler and strategy support for dForce’s Lending protocol for all its supported assets.

Evaluation and Analysis:

dForce’s Yield Markets currently already supports standard ERC20 tokens, so enabling support for WBTC won’t require additional engineering and audit efforts. However, for ETH, which is different to a standard ERC20 token, we would need moderate development efforts and engagement with a 3rd party audit before implementation.

New Strategies and Handler support:

Current dForce Yield Markets support lending protocols Compound and Aave. As we near the launch of dForce Lending, we would like to extend dForce Yield Markets strategies and handler support to include dForce Lending protocol.

Security: dForce Lending already completed its security audit and formal verification by CertiK and Certora. We will also be adding two more audits from world class audit firms over the next weeks.

Next Steps:

Once enough votes are collected to move forward, the following will happen:

Development of ETH Vault and 3rd party audit for the ETH support proxy. This requires modest efforts.

Yield Markets to add new strategies and handler support for the upcoming dForce Lending covering all its supported assets. No additional engineering efforts would be required (except ETH support).

Vote through: https://snapshot.page/#/dforce/proposal/QmXXf8fbxL2peqFFG7h9tVMf5FonVFyM7taDMoGw4ozcRs