We should definitely consider making simple products for most people (passive indexing) and more niche products for advanced users like StableCredit with 100% collateralization (if possible).
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Unfortunately I donât understand this financial tool.
- Isnât holding 1 link the same as holding its equivalent changing srUSD value?
- Why does this token have to rebase? itâs equivalent whether it rebases or not.
If you want to do an âindex fundâ then we can just have a token that give you the ability to withdraw a % of token in that pool (e.g. token sets), no need to make it rebase and make it depend on LINK.
What am I missing?
If the index is 10 asset in the basket.
The user then requires to deposit the 10 assets based on pre-defined proportions of the index.
What I am trying to say is that you can build these indexes with or without a rebasing token. What matters is that you have a percentage of the index, not the number of shares. Having the number of shares being dollar valued is just a nice UI thing, nothing more.
It would still make it easier for a user to come with 10 ETH.
Get srUSD.
Deposit srUSD and get into the fund, than doing 10 assets. itâs not UI only itâs more of UX.
As well probably easier from smart contract coding perspective and even Gas fees required to get into the fund. Iâm not solidity expert but I can see how this makes it easier than approving X number of assets and committing each one into a contract.
What I am saying is that you can create a contract where everyone can deposit multiple tokens and gives you a token that represents a share. If this token is 1-1 to the dollar value of the pool or not, it does not matter.
See my post here:
TLDR Andre calling it an index (like index fund) was extremely confusing. The value of this code is in creating a very simple stablecoin.
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Also, Im looking for people that would be interested in building this with me. Im an engineer. All roles needed, including of course more engineers 
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Iâm an engineer. But not software 
.
Happy to help with whatever I can, my strong side would be marketing/branding.
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Your position in the funds is in srUSD.
If you bought 1 index token for 1000 srUSD.
If the fund value now is 800 srUSD.
Then you hold 800 srUSD.
The index value should be reflecting the assets value under it.
The idea is more to make it easy to buy several assets in transaction rather several transactions on ethereum.
Both saving trading fees on Uniswap and eth gas fees
There could be index funds that are 90% rBTC and 10% ETH.
As well 80-20, 70-30 and so on.
Creating these baskets for several leading assets allowing users who donât want to trade on centralized exchanges an option to buy baskets and save fees.
So I just posted this on twitter, but I think this could be used to supplant Maker and Dai.
I know, but hear me out.
Tokens go into Maker -> Maker prints DAI. DAI price fluctuates like crazy with market-based incentives for it to be brought back to the peg. If DAI goes down, you can repay your loan cheaply. If DAI goes up, you can make more at a profit. You must resupply DAI to recover your funds.
This completely removes that whole second loop. In this case, tokens go into SRD (acronyms ftw) vault, and prints some SRD. The amount of SRD you have will change based on the underlying value of that deposit. My only hangup at this point is how to recover your original deposit if you use that SRD to go buy something with. Seems like that deposit would be forever locked away unless you bought the capital off the market again to unlock it.
Does this make sense, or am I crazy?
EriK @ejbaraza ejbaraza
Rebasing fiat peg may sound ok ,
but we can do much better , rebasing high value like ETH or related.
with risk mitigation.
xETH or Xplosive Eth is a price reactive, deflationary token that:
- Rewards buyers through positive rebases pegged to a baseline of 0.01 ETH
- Rewards holders through staking rewards from the pool (see next point)
- Punishes sellers through transaction âtaxesâ at a rate of 3% of the transaction amount. 2% is burned, and 1% is sent to a pool thatâs distributed to the stakers.
xETH combines the best part of elastic supply tokens such as Ampleforth but without the negative rebases (you never lose tokens after a rebase). It also borrows from deflationary tokens (BOMB, XAMP, TOB, BOA, COM, etc.) by burning 1% of each transaction, reducing the total supply over time, and increasing the value of each token.
Finally, it offers to stake dividends to incentivize long-term holding rather than short term buying and selling.
Combine these three elements, and you get a token designed to be explosive in growth, hence the name Xplosive ETH.
xETH Economics:
1. Rewards buyers through positive rebases pegged to a baseline of 0.01 ETH
xETH takes the best parts of elastic supply tokens such as Ampleforth (AMPL) and Softlink (SLINK) while leaving out what most people dislike: negative rebases.
In case youâre unfamiliar with the concept, Elastic supply tokens are pegged to some set value or moving target. In the case of AMPL, the assessed value or âbaselineâ is $1. For SLINK, itâs the current price of 1 LINK (adjusted from 0.1 LINK).
Every day, the number of tokens everyone holds increases or decreases based on how far off the token price is from the pegged price.
Rebase tokens can be incredibly attractive to buyers because you can potentially get more tokens automatically without doing anything. For instance, if you bought 100 AMPL tokens today, and the price is above the baseline of $1, you end up with, say, 125 tokens after the rebase.
And because you see 25 more tokens in your wallet, you might start telling your friends. They buy-in, and the price moves up to $1.25 . The next day, thereâs another positive rebase, and you end up with another 25 more tokens, all of which are worth $1.5 now. This can drive demand higher and higher, and explosively multiply the market cap in just a few days. AMPL, for instance, went from an $85 million market cap to a $701 million market cap (8.24x) in under two weeks.
But there has to be some downside, right?
Well, hereâs the kicker: These elastic supply tokens also have negative rebases or âdebasesâ where you can potentially lose tokens. Letâs say there was a significant sell-off with AMPL, and the price is now below the baseline of $1. Letâs say you buy 100 tokens, and a day later, youâre left with only 80.
Most people fail to understand that since everyone loses tokens, your tokens still hold the same value at the end of the day. In other words, your holdings as a percentage of the market cap are always the same as before the negative rebase.
However, most people see their token holdings go down (sometimes along with the price action) and panic. This can lead to a vicious cycle of selling that can be difficult to recover from.
A perfect example of this âapocalyptic sell-offâ scenario played out in the AMPL fork token, Rebased ($REB). REB was pegged to $1 yet could never stay above $1 long enough to have a positive rebase. As a result, the negative rebases created a cycle of selling thatâs now impossible to recover from.
Keeping those points in mind, hereâs why xETH is superior:
First of all, xETH is pegged to the price of Etherum with a baseline rate of 0.01 ETH. Meaning ETH is $440, then the baseline is set to $4.4 (0.01 X $440). Pretty straightforward, right?
Then, every day at the same time, xETHâs smart contract checks the price of xETH against the cost of 0.01 ETH. If xETH is above $4.4, thatâs considered a positive rebase, and you get more xETH tokens automatically distributed into your wallet.
The positive rebase is not a new concept but what makes xETH unique is that there are no negative rebases . If xETHâs price happens to be below the cost of 0.01 ETH, then nothing happens. No one loses tokens. This was designed to solve the apocalyptic sell-offs other rebase tokens tend to have issues with.
Also, the Uniswap liquidity pool address will be unaffected by the rebases. This keeps the trading price constant during a rebase as not to scare holders into panic selling. To incentivize liquidity providers, xETH will offer liquidity mining rewards to those who stake their xETH/ETH pool tokens.
Now, the question becomes: how can we support an ecosystem with only positive rebases and no negative rebases?
The answer lies in a unique smart-contract feature employed by some of the most successful tokens currently listed: a deflationary supply that can be adjusted based on price targets.
2. xETH punishes sellers through transactional âtaxesâ at a starting rate of 3% of the transaction amount. 2% is burned, and 1% is sent to a pool thatâs distributed to the stakers
The concept of a deflationary supply is designed to increase an assetâs value over time rather than decrease it through traditional inflationary means.
BOMB token was one of the first projects to have a deflationary supply built into the tokenomics. Then, XAMP, TOB, and BOA were developed by the notorious Bill Drummond, which made deflationary mechanics into experimental tokenized games.
With deflationary tokens, a percentage of each transaction is usually burning (sent to the standard Ethereum burn address), so the total supply decreases over time. With many of these tokens, as long as you hold and avoid selling or transferring your tokens, you gain a more significant % of the market cap over time.
With xETH, every transaction is taxed at a starting rate of 3%. 2% is burned, and the other 1% is sent to a distributed pool to stakers (more on that in a bit). This deflationary tax may be increased even more if the price stalls for several days below the peg price.
This deflationary mechanism is designed to drive buying pressure and stabilize the price to 0.01 ETH in the long-term.