Plus Asset: Yield + Usability
tl;dr: Plus asset combines yield with usability.
What is Plus Asset?
Assets on Ethereum can be broadly divided into two categories: usable assets and yield assets. Usable assets, as the name suggests, are assets of specific use values. They are mostly pegged to specific value, such as BTC (e.g. WBTC, renBTC, mBTC) or USD (e.g. DAI, USDT, USDC). Yield assets, on the other hand, generates yields over time and thus not value-pegged in their nature.
Being a yield token does not mean that it’s not usable, but its usable scope is usually limited to staking purposes. This is because a yield token is constraint by its underlying protocols. For example, the value of cWBTC depends on the long-running borrowing demand of WBTC in Compound. This makes cWBTC difficult to price and thus limits its adoption in use cases.
On the other hand, some usable asset protocols introduces a corresponding yield token in order to bring yield to their users, such as imBTC to mBTC, ibDUSD to DUSD. However, this does not solve the problem as usable asset holders will lose yield if they don’t mint the yield token. For example, if an mBTC holder chooses to provide liquidity to mBTC DEX pools, they will lose their yield which is only available by minting imBTC.
Plus Asset solves the dilemma with a single asset so that:
- It is usable since it remains value peg;
- Holders can receive global yield even if it’s used in other protocols.
Why’s Plus Asset?
Plus Asset vs Usable Asset
Plus Asset is as usable as usable asset since they are both value-pegged. However, Plus Asset solves the yield problem of usable asset: by simply holding Plus Assets, users can see their balance increase over time as interest is distributed globally to all Plus Asset holder.
Plus Asset vs Yield Asset
Let’s use imBTC and one plus asset, BTC+, as an example. Assume there is a lending protocol that takes both imBTC and BTC+ as collateral.
In scenario 1, Alice deposits 5 imBTC in her lending position and uses 2 as collateral. Alice will find it impossible to estimate the healthiness of her position since the price is imBTC is affected by both BTC price and yield generated by mStable.
In scenario 2, Bob deposits 5 BTC+ in his lending position and uses 2 as collateral. Bob will be able to evaluate his position now or in the future since the collateral value remains 2 BTC even though the value of whole position increases to 5.02 BTC due to global interest distribution. You could see that BTC+ is more usable than imBTC since it remains peg to BTC, and what’s more interesting, Bob can still get his yield even if he uses BTC+ in a lending protocol!
How Plus Asset Works?
Plus Assets achieve both value peg and global yield using positively rebase mechanism. Unlike other rebase assets such as AMPL and DIGG, the total supply and balance of Plus Assets can never decrease. Therefore, the yield can be seen as global interests distributed evenly to all holders.
Plus Assets can be divided into two categories:
- Single Plus, which is a plus asset backed by one yield token and focuses on yield generation. For example, vBTC+ is backed by vBTC;
- Composite Plus, which is a plus asset backed by a basket of plus assets and focuses on basket management. For example, BTCB+ is backed by a basket of vBTC+ and acsBTCB+. The rebalancing mechanism of composite plus balances yield and risk of the basket.
For more information about plus assets, please refer to our BSC DApp or our Github codebase.
Resources:
- Introducing ACoconut v2
- ACoconut: The First Cross-Chain BTC Yield Aggregator
- Join Telegram → https://t.me/acbtc_community
- Join Discord → https://discord.com/invite/mvANFYe
About ACoconut
ACoconut is a BTC DeFi protocol suite designed to enable frictionless movement of BTC liquidity between decentralized systems. The ACoconut protocol suite consists of BTC+ and acBTC, powered by NUTS Finance.
About NUTS Finance
NUTS Finance is a blockchain development DAO focuses on building secure, composable and open source technology to empower financial applications on the blockchain. Our team is composed of experienced developers, financiers and serial entrepreneurs.
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