Basis V2 : Launch Day Is Here!
V2 Will Go Live at 0000 UTC on 4/26
We are excited to launch Basis Cash V2 in less than 24 hours!
V2 has been redesigned from the ground up after a deep analysis of the shortcomings of V1, and contains the following key upgrades:
- V2 Dynamic Liquidity Incentives address the indifference of BAC-DAI LPs to BAC maintaining peg, as V1 rewards are static regardless of the BAC price and realized APY remains high.
- Consistent Staking Rewards will now provide an incentive to hold BAS during contraction phases.
- The Bondroom introduces utility for Bonds beyond speculating that BAC will return to peg, as a first step towards a liquid and active secondary market for BAB.
Basis V2 introduces Dynamic Incentives for BAC liquidity, aligning incentives in a manner that results in maximum profit for market participants when BAC remains close to its peg. More details of BIP-11 can be found here.
How does V2 envision BAC returning to peg?
Starting at 0000 UTC 4/26, BAC holders will have a shiny new vault available, where users can deposit their BAC tokens to earn auto-compounded BAC rewards!
Developed in collaboration with our friends at Pickle Finance, the first iteration of our BAC Vault will support a return to peg by buying BAC using its allocated BAS rewards. Once Basis Lending comes online, the vault strategy will be upgraded to utilize leverage to maximize the yield for users without selling BAS or BAC:
When BAC is under peg
- Use BAC as collateral and borrow DAI & BAS from Basis Lending
- A % of borrowed BAS gets staked in the Boardroom to earn BAS rewards and the remainder is paired with the borrowed DAI and adds liquidity to BAS-DAI LP to earn more BAS rewards
When BAC is over peg
- Sell a portion of BAC to DAI and provide liquidity to BAC-DAI
- Use BAC-DAI LP as collateral, borrow DAI and leverage by adding more liquidity to BAC-DAI
Overall strategy
- When BAC is under $1, the vault will lever up safely and earn the most BAS rewards possible without selling BAC or BAS
- When BAC is over $1, the vault will sell BAC gradually and contribute to increasing BAC liquidity.
The vault will charge no fees at launch! Profit fees will be added with the upgraded strategy. The deployed vault contract can be seen here:
https://etherscan.io/address/0x65e11596F8640D943D9F9e15166897B699ddB98f#code
At the current BAC price of $0.25, rewards for the BAC-DAI pool will be reduced by approximately 80% to 15% of BAS emissions under the Dynamic Incentives formula.
Consequently, 45% of emissions will be redirected to the new BAC vault, incentivizing market participants to remove liquidity from the BAC-DAI pool and deposit BAC in the Vault. A thinner BAC-DAI liquidity pool in conjunction with other measures to stimulate BAC demand is expected to facilitate BAC’s return to peg.
What do BAS holders need to know?
Basis V2 aims to shore up BAS demand during contraction cycles by providing consistent staking rewards to the Boardroom.
Starting at 0000 UTC 4/26, 15% of BAS emissions will flow to BAS Stakers.
We have plenty of goodies in store for BAS holders:
- Basis Lending Airdrop — 2.5% of total supply will be airdropped to BAS LPs and Boardroom stakers
- Basis Lending Private Beta — Eligibility and Airdrop Details to be released after V2 launch
- Lift Kitchen staking — Starting 5/1, users can stake BAS to farm LIFT
BIP-13 Growth-Optimized BAS Emissions Schedule
Governance approved BIP-13 with 96.9% of voters in favour. Full details of the proposal can be seen here. Accordingly, weekly reductions of 7% will be implemented shortly after V2 is launched and the accrued rewards for LPs from the migration period are calculated and disbursed.
Introducing the Bondroom
Bondholders, your time has come!
You are invited to stake your BAB in the Bondroom starting 0000 UTC on 4/26. 5% of BAS emissions have been allocated by BIP-11, and this is only the first step in our plan to give BAB utility beyond speculation. Stay tuned for more BAB use-cases in the coming weeks!
In the Pipeline
Alongside the development of V2, the team has been working on use-cases and integrations with DeFi partners, and we’re really excited for the days and weeks to come. Here’s a sneak peek:
- LIFT farming starts on 5/1
- BAC liquidity pool on Binance Smart Chain
- BAC, BAB and BAS pools on Polygon (Matic)
- NFTs with a purpose (amendment to BIP-12)
- Stableswap pools (once we have clarity on UNI V3, Curve V2 etc and can choose the most viable option)
Audit
The Basis V2 smart contracts are yet to be formally audited. The code was released for public review on 4/4 and no adverse reports have been received.
We are working with Quantstamp to get the complete V2 suite audited. We will share progress reports in due course.
In order to facilitate quick deployment and hotfixes if necessary, Basis V2 does not contain a timelock. We will be transitioning to a community-controlled multisig immediately after V2 is live and running smoothly.
Our journey to build the ultimate algorithmic stablecoin enters a new phase with the launch of Basis V2.
Basis Cash is a fairly launched protocol that operates as a DAO governed by BAS holders. Follow us on Twitter and join our Discord to participate!
