TrueFi is ready to launch new lending pools this month as part of the roadmap’s Phase 3 rollout.
tfUSDC will be the first new lending pool to launch.
tfUSDT is expected to launch 2-6 weeks later, once tfUSDC utilization rate is >25% and the community supports moving forward with launching another lending pool.
This post proposes (a) creating farms for the new lending pools, (b) and boosting farms and TRU staking incentives to drive rapid growth in these new pools.
Proposal
The objectives of this proposal are to double total value locked (increase to ~$200M TVL) and to generate >$60M in new loans by end of June, using the following levers:
i. Create new farms and boost tfUSDC and tfTUSD emissions for 14 days following launch:
Create a tfUSDC farm w/ daily emissions of 290,934 TRU / day
Boost the tfTUSD farm daily emissions 2x from 145,467 to 290,934 TRU / day
Time period:
Boosted emissions run for 14 day period, starting when tfUSDC launches
After 14 days, emissions will revert to 145,467 TRU / day unless extended by governance.
The success of this campaign will inform our approach to incentivizing the launch of the tfUSDT lending pool, which will be a separate discussion/poll.
ii. Increase TRU staking emissions 25% to encourage new TrueFi participants to stake their TRU rewards:
Increase stkTRU daily emissions from 100,000 to 125,000 TRU / day
This aims to maintain current ~50% staking APR for 100M TRU staked
Emissions run for 90 days, to be revisited by governance before Phase 4
Proposed total emissions increase vs. current:
14 day launch period: 461,401 additional TRU / day
Day 15 - Day 90: 170,467 additional TRU / day
Rationale
Adding new assets is a massive opportunity to grow TrueFi
TrueFi has grown from $0 to ~$100M TVL w/ only TrueUSD which has had ~$500M in avg. circulating supply during TrueFi’s lifetime
New assets represent >$65bn in circulating supply
USDC supply = $15bn, USDT supply = >$50bn
As lending pool sizes grow, staked TRU should grow too
stkTRU provides default protection for lenders and builds confidence that TrueFi can weather one or more defaulted loans
HODL and stake:
As new lenders collect TRU rewards, staking incentives can attract users to get involved in TrueFi staking and governance
Staking rewards should be competitive with Sushiswap TRU/ETH returns; in my opinion, stkTRU APY should be higher than Sushi’s because staking delivers more value to our ecosystem than LPing
Now feels like the right time
Draw our line in the sand: We’re opening up TrueFi to a huge swath of new users; let’s seize the opportunity and stake our claim as lending platform of choice for DeFi summer pt. 2
Improve TRU fundamentals: New pools can generate lasting loan activity and protocol fees for TrueFi
I suspect it does. With two out of eight unlocks already finished we settled at around 65 million staked TRU. With a third unlock on the way this number is expected to increase to 100 million staked TRU. Adjusting the daily rewards accordingly (from 100k to 125k a day) will ensure that APY will remain at around 50% for the coming months (until August when the next batch is unlocked).
The most important sentence in this proposal is that APY rates should indeed be favourable within the platform. I fully agree with everything proposed. I just didn’t see the part about an earth shattering token burn
A brief boost to tfUSDC and TFUSD rewards coupled with the launch seems like a good PR move. The cost is fairly modest as its only for 14 days.
I still don’t think we should be incentivize TRU staking at all and the value proposition should be that its price growth with the loan pool. It seems likely to temporarily boost the price, followed by a decline due to increased dilution.
When the new pool is live I suspect you can not move coins from one pool to the next?
After the first 14 days with 100% ROI, the pools level out to the same 50%. What is the incentive for existing members to stay in the old pool for the first 14 days?
I have just purchased more TRU to stake but it looks like I need to keep it off the site and unlock what I have staked to join the new pool and maximize return when it goes live?
Should the existing user base already investing in the LP get incentive to not defund the pool and move to the new one?
I am new to crypto and am glad I found this community. I am just struggling to see why the existing pool would not deflate from members pulling funds to capitalize on the new pool. I assume the goal is to be staked in all pools. Maybe some thought needs to go into rewards during the new pool integration to keep existing funds and pools stable. Maybe and most likely, I am missing something?
Hey @Rockgolfer – welcome to the forum, here are responses to your questions:
Lenders can move from one pool to the other
I expect that some lenders will move from tfTUSD to tfUSDC until ROIs stabilize. The only thing keeping existing lenders in tfTUSD is the pool currently has ~30M loans out, so ~50% is liquid today.
Current stakers will get the 25% boost on TRU staking rewards. The increased rewards will flow through the same staking contract. If you stake TRU today, you’ll receive the increase staking rewards without having to move pools. (Is this what you were asking?)
It’s a good question – I’m actually ok with current lenders moving from one fund to the other. My thinking is (i) tfUSDC could be our largest pool long term, so I think its incentives should be on par with tfTUSD’s, (ii) liquidity is a feature lenders value on TrueFi and I don’t want to constrain lenders’ ability to exit pools when they wish – it can be a win-win because liquid exit generates fees for the rest of the lenders. I expect some funds to move from tfTUSD to tfUSDC chasing high yields right after launch, but I think more new TUSD and USDC will flow into TrueFi til ROIs on both pools return <100%.
It is making more sense to me now. I am a construction worker who is for the first time in my life, exploring finance and investing. It’s all new to me and I’m sure most of my questions are low level thinking. This forum has really helped me grasp as much as I can about this project and has me very excited to be around close to the ground floor. I appreciate people like you and the other contributors taking the time to help us newbies. Believe me, it helps grow the community and makes it easier for us to pass on the word of this company and community.
This might be borderline off topic but I have one lingering thought/question… I see a huge drawback to crypto(something I had to dedicate a lot of time to try and overcome myself) is the ease of entering and using individual projects in the crypto community as a whole. With the idea of future growth and no knowledge from an advanced educated standpoint, why create separate pools at all? Can the same thing not be accomplished by simply adding another trust token to the single pool already in existence?
You’re right – there’s a big learning curve to use any DeFi app and there’s certainly more we want to do to make TrueFi easier to use. The tfUSDC pool should make TrueFi much easier for users who have USDC – now they can come straight to app.truefi.io and deposit USDC to get started.
This helps us reach the large audience of USDC users in our current setup.
I’d actually like to see a pool in the future similar to 3crv / yUSD where users can deposit different stablecoins into a single lending pool. Curious if others here think that’d be a good idea or not.
