IPTMan Delegate Platform

Updates & Announcements
#1

Delegate Name: IPTMan
Delegate Address: 0x5fee8d7d02B0cfC08f0205ffd6d6B41877c86558
Forum Handle: IPTMan
Email: iptman7@gmail.com
Discord: IPTMan.eth

Delegate Platform or Philosophy:

Core Values

  • Stakeholder Recognition - Protocol/Delegate actions should take into account affects on all stakeholders. IPT holders, vault owners, and USDi holders. There is a firm belief in making compromises that seek to achive WIN-WIN-WIN for all stakeholders and worst case avoids a LOSE scenario for any of them.
  • Secure, Sustainable and Scalable Systems.
  • Importance of Data Analytics to Goal achievement and problem solving.
  • Transparency - A dedication to carrying out activities as transparently as possible.
    Delegation Statement

Service to Interest Protocol involves the following commitments:

  • In good and bad economic times, look out for all the important IP work-economic stakeholders (IPT holders, vault owners, USDi holders and users, InterestProtocol DAO, and DeFI in general).
  • To looking at the IP system from both the internal microcosms of contracts, people, operations, to the greater macrocosms of DeFI and the real world in terms of fair, equitable and transparent governance, law and finance.
  • To creating Safe, Scalable, and Sustainable Systems as Simply and Efficiently as possible.
  • To growing IP and USDi in a way that is Sustainable for the long term.
  • To use Data Driven Analytics to drive decision-making and measure goal achievement. Look towards the future by analyzing the past and present.

History and experience I bring to IP

Multiple years of DAO participation in Maker (retired MakerDAO delegate but still active in forums, discord), 1Hive, and personal experience across a number of ecosystems and DAO communities from Ethereum, to Gnosis, Polygon, Celo, Optimism, Arbitrum, etc. Strong scientific educational background that focuses on a measurement approach to problem identification and application of solutions. In all my DAO actions I seek to bring forward issues with proposals for discussion seeking community consensus before acting.

Conflicts of interest

While I am active in many communities it is my general approach to conflicts of interest to first.

  • Declare those publicly. (be Transparent about conflicts of interest)
  • Abstain from votes where conflicts of interest exist.
  • If necessary re-delegate my voting power to another less or non-conflicted individual/delegate.

First edited 20221012_0347UTC
Last edited 20221012_0347UTC

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Proposal:IP Recognized Delegates Program
#2

Please indicate your monthly activity on your delegate post here.

Here are the requirements for compensation.

Compensation Eligibility:

  • Communicate on the IP forum how and why a delegate voted the way they did within seven days of the close of a vote (minimum 90% of the time) in their dedicated delegate thread.
  • Command voting weight greater than or equal to 1 basis point of the total IPT supply;
  • Participate in at least 90% of all on-chain IP votes within the previous 90 days
  • The Recognized Delegate (or one authorized representative if a team or institution) must attend at least one public protocol development call each month
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#3

20220107_1733 UTC IPTMan Delegate communication.

NOTE: I will figure out how I want to format these and I may be beyond the 7 days on IPT proposal 15 but I have been meaning to get something up on IP prop 15.

Regarding IPT governance proposal 15

This proposal changed rewards from a 2/3 to 1/3 split for USDI borrowers:Uniswap v2 ETH/USDI liquidity to more like a 44:55 split for USDI borrowers:USDI holders eliminating ETH/USDI v2 liquidity (only because there isn’t 100K there currently). This was to attempt to reward those holding USDi and try to bring more USDC into the protocol.

I believe that using IPT token to reward liquidity IS useful but honestly rewards should be connected to liquidity NOT a fixed decaying amount. You would think markets would take advantage of 40-50-100% APRs but the competition for these kinds of rewards and the rates are just too high. I’d prefer to conserve IPT and target some kind of liquidity reward rate in the 10-20% APR range based on avg IPT price during the week. I also believe that if IP is going to push out IPT rewards it should also incentivize IPT:USDI or IPT:USDC liquidity as giving a market to IPT is just as important as liquidity for USDI.

I did not oppose this governance proposal for a few reasons:

  1. I personally benefit from this change due to my own positions.
  2. The change doesn’t really change rewards that much.
  3. As an experiment we could see if there was any real change.

While this looked to moderately succeed the last I looked deposit rates were running almost 30% and borrow rates around 40%. I ended up having to deposit some USDC just to bring rates down to the 4% deposit and 7.5% borrow.

The inherent problem here is liquidity management. There is no USDC that the protocol can use to buffer rates, and the rate curve model while useful, doesn’t really take into account the size of the liquidity base against the borrow. We’d have the same kind of curve if there was $100 USDC vs $10M USDC the curve is a feature designed to bring in and exit liquidity on the ends of the rate curve but doesn’t really do that well incentivizing liquidity nor managing rates when the protocol is small (<$1M USDI is small).

As I have been working on my own grander model I have come up with much better ways to deal with the initial bootstrapping of liquidity and this really involves having some amount of liquidity outside of the liquidity system which can be used to manage system liquidity and rates.

The concept for IP would be to set aside some of the USDC raised in the initial sale and use it within the protocol to achieve a target borrowing and deposit rate, kind of like the D3M in Maker. Set a target rate and allow the USDC to move into an out of the protocol to take advantage of returns.

There are benefits and drawbacks to this model.

Drawbacks

  1. Need USDC liquidity base.
  2. The management of rates is limited by the size of the liquidity base.
  3. Transactions to enter/exit USDC/USDI are costly so this won’t be fine grained.
  4. At some point the amount of USDC required to manage rates this way will be outstripped by market demand (rates eventually will fluctuate, BUT they can still be buffered to some extent by this USDC liquidity pool).

Benefits

  1. A liquidity managed rate gives borrowers some stability (not guaranteed) but then rates won’t be fluctuating so much.
  2. More dependable borrow and deposit rates.
  3. The USDC generated by initial raise could earn some return growing the USDC in the protocol. (i.e. use the protocol to earn return on cash).

It is my hope to change this rewards model to something that makes more sense generally and has long term sustainability.

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#5

thank you activity noted

#6

@IPTMan can you confirm if you have attended the monthly meeting? Also that you meet the eligibility to be a recognized delegate.
See here: Proposal:IP Recognized Delegates Program - #17 by mastermojo

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#7

Assumption on ‘meeting attendance’ would be that someone else would take roll-call and post. Me saying I attended probably isn’t the most secure way of verifying this. @PaperImperium and others know I was there at the January meeting.

As to eligibility to be a recognized delegate. I have a significant delegated position (now listed at 1.47M). As to noting proposal support given the nature of how optimistic governance works we only are voting if we don’t support a proposal. This idea that I am going to have to write up why I support everything to me is more about why I don’t oppose it.

I have stated elsewhere that I think the whole nature of optimistic proposals is that there is no distinction between a yes and an abstain vote and putting this information in delegate platforms vs. forum proposal threds or burying it in delegate platforms probably not ‘optimistic’ approach to tracking proposal sentiment and ‘voting’. Delegates can just link to comments in those threads. I will try to follow the above with mine.

BTW: When it comes to collateral additions unless I am really against them I usually don’t have much to say. My biggest concern is that collateral is being added to satisfy people’s personal preferences. I tended to avoid this (as I would be pushing for Uni v2 ETH-USDC btw since I would use that to back my collateral borrows vs. other things). I consider the LP and interesting earning types to be better collateral than straight up non-earning tokens since they should increase in value against a flat $$ borrow than any other collateral. MATIC, UNI, ETH.

#8

20230131_1800UTC IPTMan Delegate communication.

IPT governance proposal 16

First I want to make some general comments regarding how ideas are handled. Example here is that again multiple ‘proposals’ are being bundled. There is no single discussion thread regarding IPIP 16. But there are two different discussion threads regarding changing the UNI LTV and adding ZRX.

I personally like clean delineations between:

  1. when something is being discussed (proposal RFC - where a proposed idea details are put forward and the community refines any details) and
  2. When the proposal is a formal IPIP with a number and RFC is effectively closed for discussion.

My point here is that to look at discussion for IPIP 16 I need to scan two different threads. I am decidedly against merging of proposals because I don’t like the idea of stopping 5 things because I disagree with one of them.

My other point is a suggestion for vote/sentiment tracking.

Once a formal IPIP proposal is up for vote there should be a IPIP Number with title proposal forum thread put up. Delegates and anyone else voting should voice support, abstain, rejection in that thread. Delegates can link to their comments in the threads to confirm governance participation meeting participation metrics. This suggestion solves two problems.

  1. A single unified place and way to search on actual proposals and vote + vote sentiment
  2. (1) above is the unified place for Delegates to complete participation eligibility requirements.
  3. Delegates can then link to their vote comments in IPIP proposal threads so anyone tracking delegates can easily look at delegate threads for links to IPIP proposal votes for information.

The above clarifies a number of communication issues around IPIP proposals formally in governance to to be/being voted on, vs. proposal RFC and simplifies how to find things in the forum. When I look for IPIP 16 in the forum threads - nothing comes up. Yet i can look up adding ZRX and changing the LTV on UNI and have two different threads. Where exactly is the place to post my vote sentiment. If delegates do this individually in their delegate threads there will be no easy way to gather voting information.

Regarding IPIP 16 proposal formally in governance

The ZRX token is the governance token of the 0x Protocol. It was one of the first [DEX governance tokens ever deployed (2017)](javascript:void(0)).

The proposed parameters and cap are set conservatively given relative low DEX liquidity. To be revisited if liquidity increases.

$250K cap
50% LTV
Liquidation fee(incentive) 15%
oracle ZRX/ETH

Hard for me to see with 50% LTV and 15% liquidation fee that people would use this collateral and the 250K cap won’t do much for the protocol. Straight out of the gate at Maker I was decidedly against willy nilly adding small collateral because I felt it was a waste of time. I was overruled at the time and later due to high on-chain oracle costs Maker realized it needed to remove these. Unclear to me that the ROI for the work/cost to keep this in the protocol will actually be worth it.

I am for looking at entire market and adding large cap collaterals. I am against Delegates or whomever trying to add their pet low liquidity collaterals (because no-one would oppose them).

Regarding changing the LTV to 70% on UNI.

I think UNI is a better addition to IP, it has a higher market cap and trading. I had started a review on the LTV, liquidation fees, and caps of collateral types on IP and felt that normalizing the liquidation fees to the LTV and managing exposure by controlling cap was more useful approach. Having provisional collateral setups useful, but once these are formally added and pass the provisional period I would like to see a more ‘standardized’ approach to criterion for collaterals to add, and Liquidation Fees against LTV against cap done.

I will make a forum thread at some point and post my notes and thinking on this. The real goal here is to find collateral that people really want to borrow with that has significant cap, robust trading, that needs to be served.

I think the real issue for IP is why should someone bring collateral to IP vs. Compound, AAVE, Maker, etc. We need to think about what IP can bring to the table here that can increase our growth and this may require taking some risk and thinking outside of the box to get from 1M USDi to 10 or 100M USDi.

End result here.

While I can’t say I support addition of ZRX, with the cap low and conservative terms I see no real reason to oppose it. The LTV change on UNI I already had as a target in my own models (hence I support this) which I will post in the next week or so regarding normalzing fees/LTV and using caps as the risk management.

2 Likes
#9

Really appreciate the detailed post IPTMan! Can you elaborate a bit more on the cost to setting up on-chain oracles? I know Uniswap oracles are free to use but I have no idea the associated costs to setting up Chainlink oracles and what the ongoing maintenance fees are.

I’ve been wanting to dig into this topic for a while but haven’t found any detailed resources online.

#10

Hello,
We have booked the date for the first monthly call for delegates on Feb 10. Please check discord for the event post, which will indicate the meeting in your local time.

#11

20230405_1925 It has been a long month with a lot of interesting activity. USDC price dropping 10% due to Silicon Valley Bankruptcy being one watched with interest and some concern. I missed the 3/27 meeting but was there for earlier march meeting.

I voted yes to feems $600 USDI and yes to CHAI though seeing the results of the relatively risk free CHAI being used to basically borrow USDI and claim the lions share of the IPT rewards pushing me to make a post for IP to really reconsider adjusting IPT rewards both as an experiment and as a chance to connect returns to amount of liquidity. 5 people holding 85% of the USDI just to claim rewards isn’t really doing much for the ecosystem. At best I think some new discussion based on the fact that liquidity didn’t really change much after last change to rewards is warranted.

1 Like
#12

20230506_0220 Participated in last IP community call at end of April.

Voting activity.

Proposal 22: March Delegate Program Administration Expenses
I thought I had a transaction up for proposal 22 but ultimately gas ran away from me. If this didn’t have the required 2M votes I would have upped gas to clear my vote but since it had 2M votes I didn’t. I generally support reasonable compensation for IP administration tasks. delegate compensation etc. $600/month not unreasonable for some minimal IP administrative tasks and the monthly report of governance/proposal delegate activity.

Proposals 23, 24: Add YFI and LINK collateral
Supported

Proposal 25: Temperature Check on IPT rewards
Supported pausing IPT rewards for 4 weeks - both as a savings to the community but also as a real experiment to see how users react. As I stated in call once we see changes in collateral and with potential release of IP instance on Optimism we can revisit rewards.

Some general comments

Excited to see IP making some progress on adding Uniswap v3 NFTs as collateral and Balancer LPs so it will be interesting to see what happens there. I have some concerns about the IPT market liquidity. I am going to say this so people pay attention: One of the most critical things a community needs to do is to create a market for their token and back it with capital/liquidity as well as some level of incentives. This is important for many reasons I have written on both with 1Hive, Maker, Symmetric (Balancer fork on Gnosis, Celo, etc.). If one believes in the project long term then it makes sense to set up community owned liquidity as this will earn returns from trading and provide a robust market for trading making IPT rewards something that has real value.

Beyond this I have been thinking quite a bit about how to diversify the liquidity base of IP so USDi could be backed by multiple stable coins. I also have been thinking a lot about how to reduce risk via diversification strategies.

The idea @PaperImperium brought up regarding a partnership with other stable coin issuers on other chains I think is interesting and should be pursued. Using different stable coins in different IP chain instances MAY be a way to achieve some diversification in assets and USDi bridged from one chain to another and acceptable as a deposit or collateral I think has some potential to mitigate damage to IP due to any one single stable coin having issues.

Other work was looking at COWswap limit orders and thinking there might be an opportunity to use automated sets of limit orders to take advantage of arbitrage using USDC, and USDi to buy/sell whenever USDC/USDi market prices are away from 1.

I think it is critical we get USDi into trading markets via LP etc. I don’t see a really good way to incentivize this at this time, and the stable coin competition is significant across all chains., optimism included.

Here is a quick glance of stable pools on Velodrome/Optimism (took this as a quick but not exhaustive list of stables on Optimism and number is chain token contract liquidity)

Optimism Stable coin liquidity in Millions

USDC 363.8
DOLA 28.2
MAI
CHI
USD+ 11.7
LUSD
DAI 59.2
USDT 70.5
sUSD 69
FRAX 5.2

USDC is clearly the gorilla on Optimism with more liquidity than all other stables combined.

Ask yourself how and why USDi itself will compete with these stables on optimism.

#13

5/15 Community call - Missed.

Proposal 26 April Delegate Program Administration Expenses - Supported.

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#14

20230601_1131UTC

5/30 Community call - Attended

Upcoming continued additional 4 week pause on IPT rewards (intend to support).
Regarding various ideas discussions during call will edit and add to this post as I have time in the coming days.

#15

20230623_2335UTC

6/22 Community call - Attended

Proposal 27 - Proposal to pause IPT rewards for another 4 weeks - Supported

Proposal 28 - May delegate expenses - Supported

Proposal 29 - Addition of BPT collateral - I still have concerns regarding the untested oracle and hope to see a better write up of what the oracle returns under various conditions. Fortunately interest protocol is still quite small so hopefully any risk is relatively minimized.

Some general comments:

I am excited to see the Interest Protocol deployment on Optimism coming up, but I am concerned that coordination of getting IP up on Optimism may leave some marketing and technical gaps.

If IP governance wants to reinstate rewards on Optimism network we will need IPT liquidity on that network (probably another proposal is for governance to bridge some amount of IPT) which will require Optimism devs to add IPT L1 token to the bridge, and Velodrome to whitelist IPT and opUSDI and someone is going to have to drop IPT with opUSDi (or USDC, etc.) LP on Velodrome to kickstart IPT trading on Optimism to give value to the IPT token there should governance want to start IPT rewards there. If we want to get on the Velodrome ve(3,3) flywheel IP governance is going to have to think about building a veNFT position. veNFTs trade for 30-40% off VELO price and by voting direct VELO emissions to LPs. For the community purchasing veNFT is a way to purchase some amount of VELO rewards for LP. I think it behooves IP governance to get on the Velodrome flywheel, and between doing this and the various other activities we might be able to get some more engagement of the protocol with people on IP.

My concern is that NOT doing the above will weaken the IP launch on Optimism.

#16

20230712_1436UTC

7/6 Community Call - Missed

A couple of quiet weeks while GFX devs launch OKU we wait for IP to launch on Optimism and BPT collateral to be added to the protocol.

#17

Well schedule another call later in the month for July

#18

20230722_1929UTC

Realized I voted but forgot to post this.

Proposal 29 adding BPT collateral to IP - after discussions with others ended up voting yes to addition of BPT collateral. While this has passed and is ‘executed’ it is not clear whether BPT collateral has actually been added and can be used.

Proposal 31 June Delegate Program Administration Expenses - Yes

Proposal 32 Addition of MKR collateral to IP - Yes

#19

20230821_1257UTC

Proposal 33 list SNX on IP Optimism deployment - Yes - cap is low and SNX is well traded on Optimism.

Proposal 34 Pause IPT liquidity mining rewards until further notice - Yes - Really want to have a solid plan with IPT rewards.

Some general notes. Not a lot of traction with IP being released on Optimism. As far as I can tell mainnet no work has been done with Velodrome or Optimism teams to get IPT whitelisted on bridge, or on Velodrome so IP can get on the Velodrome flywheel with IPT even if governance wanted to. The plain and simple here is that if dev/operations teams are not going to put effort into getting what governance needs then it was/is a strong signal to me GFX isn’t too serious about promoting IP.

Perhaps governance needs to put a governance poll on above getting done as it looks like devs on Velodrome and Optimism require development teams to contract them regarding new project listings. I know they would be very happy to announce new projects entering the system.

Also since IP is on Optimism we might also want to consider getting on BASE as well as we could probably get on the Aerodrome flywheel pretty early there as well.

The real issue with the Velodrome and Aerodrome flywheels is accumulating a DAO position in veAERO and veVELO.

#20

20230828_1302UTC

Proposal 35 July Program Delegate Expenses - Yes - As a note here I would like these votes to be quarterly/yearly as it seems a waste to have to vote on administrative expenses monthly. I support various sorts of compensation for paid positions but would rather see these with longer governance cadence.

Proposal 36 Adding SNX to the Optimism IP instance. - Yes - All for this as long as the cap is reasonable (which it is). In fact IP could just look at SONNE for a list of reasonable collateral types to add. One thing Velodrome needs is ability for veNFT holders to be able to borrow on their positions while still retaining ability to vote and claim rewards. Ability to borrow and stake Velodrome v2 LP positions would be useful and unique as well (very much like the balancer setup we have now). IP needs to show off new the new tech in places it might actually be used. So far I see very little use of balancer LP in IP which is pretty sad.

#21

20231007_1423UTC

Been an insanely busy end of fiscal year for me. I missed voting on Proposal 37 by 4 hours :frowning: so it failed. I think this illustrates a kind of governance failure if one IP voter can make or break a proposal. Really would like to see these monthly payments go to more like a 3-6 month voting cycle and have a well defined governance cycle and maybe get a few more delegates on board here.

As to next steps for IP, I hope @Getty and IP dev team can get v2 type LP working (Like for Velodrome/Aerodrome/Uniswap) so people can still stake their v2 LP for staking rewards while also being able to borrow against their v2 positions. Stuff like ETH/USDC shouldn’t be too difficult and borrowing against v2 could become a selling point for IP.

As to current votes and activity:

Attended 20230927 Community call

Proposal 36 - August Delegate Program Administration Expenses - Missed by 4 hours and since I have significant IPT proposal failed by 500K votes. Sorry IP community!

Proposal 37 - August Delegate Program Administration Expenses - Supported.

As to things to work on for IP. I really think the addition of Uniswap v2 assets to IP instances would be useful and unique. Not sure if this would bring back my liquidity back at this point or not, but it would give me and other better options to borrow against liquidity positions and still earn staking rewards where ever IP instance lives.

One thing I can say is that the crypto markets have moved mostly from trading to a farming perspective. Volumes are going to stay down as long as people are earning 10,20,50,100,200,500,1000+ APRs and up via various farming and staking options. The markets have evolved from a trading (buy a token to hope price goes up and sell) to buy a token to earn staking returns somewhere (sell staking returns) to actually being able to earn pretty decent returns with various stable coins, stable coin LPs etc.

Most crypto is turning out to be hot money looking to maximize returns while minimizing risk. If you can earn 10-30% on a stable coin or a stable coin LP why would you bother trying to buy and pair a token with a variable price to either another token or a stable to earn an unsustainable 50-100%. Trading fees are dropping not increasing and network, dev, liquidity fragmentation is real.

In time I expect most of these high APR/APYs to go down, or go away. I do expect returns in crypto to match or slightly exceed Tradfi returns, BUT as and if TradFI returns climb I expect less and less money to seek much riskier assets in crypto. In fact if TradFi rates really climb (say 10% or higher) I see money will start exiting risky crypto to look for ‘safer’ returns in TradFI. Since I see a lot of the movement in crypto to be moving from crypto only stuff to real world it would make sense to cut out a lot of the risk on the crypto and move liquidity directly to TradFI in such a case.

I am also expecting over next few years for some real market activity by BRICs against the hegemony of the US dollar in a lot of markets and this will create additional turmoil not just in TradFI markets but crypto. At some point various sovereign’s are not going to be able to service even the interest on their debt and this will lead to greater and greater financial, market and economic instability. The whole lower interest rates to keep the economic train from falling apart basically allowed sovereign’s to borrow themselves into insolvency and now they are addicted to borrowing just to pay off interest on their mounting debts so this keep rates low to help sovereigns and national economies is going to not play nice with trying to keep inflation low. In the end I think most heavily indebt sovereigns will give up on controlling inflation in favor of managing their national economies until hyperinflation finally gives way to most of their currencies.

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