[YIP-74] YFI Wintermute Loan & CRV Plans

Hey guys,

thanks for all the feedback. Adding to @wishful_cynic 's comments, we’d like to reach a middle ground where both sides are relatively happy but ensure we can keep it as simple as possible.

It’s clear that the largest concern from the community is that the loan has no collateral from our side, which is fair considering the events that have happened over the past year.

So we propose this:

  • We retain the same initial plan as before - use up to 3M CRV to buy yCRV, deploy yCRV tokens to the yCRV-CRV pool and stake this on yearn.

  • Our CRV (whether that be yCRV, st-yCRV, lp-yCRV, vl-yCRV) will be held in a 3/4 or 4/6 multisig with wintermute folks and core yearn contributors

  • Yearn multisig operators agree to approve anything we do as long as it’s within the Yearn + CRV ecosystem (e.g., swapping to vl-yCRV).

  • We will extend our staking duration to 12 months to match the loan duration, however, after 6 months we have the option to return the YFI and receive our collateral back.

This keeps both parties’ commitments rather simple and we provide collateral for our loan.

We also want to reiterate that the loaned YFI will be used solely for our delta-neutral trading, we have no intent to sell it, and it will not be used in the YFI tokenomics ecosystem.

1 Like

can you clarify in this set up what the expectation is if the position becomes undercollateralized?


All the risk in this proposal is on Yearn’s side and all the upside is with wintermute.

Is deeper liquidity for $YFI even a priority for the dao at this time? Yearn also bought $crv from michael at the otc price of .4. It seem’s illogical to rent more $crv at a worse price imo…


I am glad to see the CRV now serving as collateral, but to me the benefits to the arrangement are still very uneven. In sum, Wintermute makes income on two different sources of capital, while Yearn sees only transient liquidity for lp-yCRV (and even beyond this, the well-designed st-yCRV and lp-yCRV finds equilibrium quite nicely on its own, already) and takes on risk with the YFI leaving the treasury.

The only way that I could support and vote for the proposal is if Wintermute’s CRV was used to mint new yCRV (and then the position could be managed from there), for there to then be some lasting benefit for Yearn, in this case in the form of increased veYFI balance and share.


I should add that yes, another, albeit harder-to-quantify benefit for Yearn is the positive perception of Wintermute choosing to use Yearn’s yCRV product for their CRV position, and maybe this parlays into a lasting relationship beyond the duration of the agreement.

This benefit would be completely obliterated, though, by negative sentiment if Yearn accepts an unbalanced agreement – which in my view is still the case with the modified proposal (even if it is one step better than the original).


Voting is live for 5 days vote with veYFI at snapshot.


This topic was automatically closed 7 days after the last reply. New replies are no longer allowed.