APWine is a protocol to tokenise, trade and hedge risk on future yield. The project was started in August 2020, and is backed by actors such as Delphi Digital, Spartan Group, DeFi Alliance and builders from the DeFi ecosystem. APWine is also partnering with other DeFi protocols, like Harvest Finance, to provide a rich selection of assets and optimise yield and liquidity on the platform. The token was recently distributed to the community through a liquidity bootstrapping event and the final Mainnet iteration of the protocol is set to release in the next few weeks.
APWine works with a future contract architecture by splitting yield-generating assets and their yield into two separate tokens: Principal Tokens (PTs) and Future Yield Tokens (FYTs), which can then be traded on the AMM. This lets farmers hedge their risk on APY volatility while giving the opportunity to speculate on the evolution of interest rates.
To kick off the upcoming V1 release of APWine, we believe yUSD would be a useful asset to have as one of the select products listed on the protocol, due to its high APY relative to regular lending platforms (Compound / Aave) and relevance within the DeFi ecosystem (with stablecoins being a widely adopted option for lending).
Usually, the APY of yUSD fluctuates depending on a multitude of factors and market conditions.
By integrating yUSD on APWine, users of Yearn would be able to separate their generated yield from the base asset. In practice, this allows them to:
- Hedge risk on APY volatility by selling Future Yield Tokens on the AMM
- Trade and speculate on the volatility of yUSD APY
- Get upfront, fixed-rate yield ahead of time to reinvest in other strategies. Think “yield-ception”!
- Earn additional APY by becoming a liquidity provider on the AMM, earning trading fees + platform rewards
This proposal is related to APWine request for delegated funding DAO vault loan through yVCDAO - #3 by LOGYKAL, discussed back in September 2020.
APWine’s product has since drastically evolved and has become much more mature in terms of UI/UX and usability, providing a smooth experience for Yearn users to trade and hedge their risk on yield volatility.
To help cover a part of development and deployment fees associated to supporting yUSD and listing the asset on APWine at launch, a grant of $20,000 in YFI tokens is being requested from the Yearn DAO. The grant shall be provided once the product is live and working, as a sign of successful collaboration and eagerness to explore future synergies between APWine and the Yearn team and community.
For: the grant is awarded to the APWine team upon successful integration.
Against: no grant is awarded.
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**Poll**: [poll type=regular] * For * Against [/poll]
Thank you for your consideration.