Flamingo/Flamincome Progress Update — 11/27/2020
Since the last update, the team has been working on several key areas:
- Finding a solution to restore the price pegging of n-assets.
- Preparing for the launch of Perp.
- Gradually rolling out the governance mechanism.
Restoring the n-assets peg
The team recognized that maintaining the pegging of n-assets to corresponding original assets is a critical prerequisite to realize asset interoperability and DeFi usability on the Neo blockchain. To enhance the capital efficiency for Flamincome/Flamingo users, a sophisticated process of asset synthesization was established initially: original asset → f-asset (yield-generating) → n-asset (normalized with value pegged to original asset for cross-chain). While the logic behind this design is solid and all n assets are fully backed by corresponding original assets, the introduction of non transferrable Collateralized Debt Positions (CDPs) still creates a barrier for the fluid redemption and arbitration of value. As a result, price disparities of n-assets on Flamingo Swap have been observed due to the lack of liquidity support.
The team has earlier deployed measures of mitigation, but to resolve this issue permanently, the team is now taking a more innovative and thorough approach to design a new mechanism for yield aggregation on the Ethereum side. Through this new design, the liquidity issue will be resolved once and for all. More details will be shared once the design is finalized.
Launching Perp
According to the original roadmap, Perp was set to launch on 28th Nov. The development of the smart contract and the frontend is almost finished, however, the team decided to postpone the beta launch to mid December to take time to conduct extensive testing and optimization. AMM-based perpetual contract protocol is a rather new concept, the combined challenges of liquidity provision, volatility and leverage management have created a very complex situation for protocols to manage. The team therefore decided to take a more cautious approach towards launching the product, and the team will be hosting a trading competition along with the beta launch.
Rolling out Governance Gradually
Governance is another important component of the Flamingo Project, the team will be gradually rolling out governance components and extending the scope phase by phase to ensure a smooth transition. The voting of the first governance proposal will be held from UTC 08:00 12/01/2020, to UTC 08:00 12/04/2020. In the proposal, the community will decide whether to use the GAS generated by nNEO as the Perp trading competition reward. Details on how to vote will be announced later.
