Author: Jarvis Network Core Team Forum post: Listing proposal: add jEUR on Aave v3 on Polyon

Summary

The purpose of this AIP is to list Jarvis Network's jEUR, a synthetic euro stablecoins, on Aave V3 when it deploys on Polygon. jEUR is a liquid and capital-efficient Euro stablecoin collateralized with USDC, and with a working 0-fee fiat on and off-ramp. jEUR can be converted for USDC back and forth at the Chainlink price feed, granting it liquidity and peg on our primary market. jEUR is used by other Euro stablecoins on Polygon in Curve’s pools to help them with their own peg and liquidity.

About Jarvis Network

Synthereum is the first protocol of the Jarvis Network. It provides a capital-efficient manner to issue and exchange synthetic fiat currencies called jFIATs, on Ethereum, Polygon, Gnosis Chain, Avalanche, and the BNB Chain.

jFIATs’ main feature is their convertibility for their collateral (USDC on Polygon) and for other jFIATs at the oracle price, without price impact, enabling a 0-slippage on-chain Forex. This feature makes them usable: since one can convert them for USDC at any time, they keep their peg, and have the same market depth as USDC, and therefore are very liquid.

The protocol is integrated within Paraswap, so users can swap jEUR for any other token.

We have partnered with Mt Pelerin, a Swiss regulated entity, to provide users with a 0-fee 1:1 fiat on and off-ramp, directly on Polygon (and other EVM chains). Anyone can go from their Euro bank account to jEUR on Polygon, back and forth. One can even pay invoices in Euros using jEUR (our company only uses jEUR to pay invoices, salaries, rent, and even taxes, since July last year).

Combined with Paraswap, this partnership with Mt Pelerin creates a system that can replace CEX, and provide users with a way to buy any token on Polygon with Euros, at a better rate than most CEX (including Binance, Kraken, etc.).

We also have launched jXAF/jXOF, which are wrappers of jEUR (XAF and XOF are pegged to the Euro) to address the African market (+ we are building a fiat on and off-ramp in Africa). Any integration of jEUR is therefore accessible to jXAF/jXOF holders.

jEUR is a vital Euro stablecoin for the Polygon ecosystem since it can be converted for USDC at the oracle price; therefore, other euro stablecoins can be paired on Curve with jEUR in order to facilitate arbitrages to maintain their peg, or simply to access greater liquidity.

We debuted on Polygon around September. Currently, version 1 of the protocol is live and is limited (only 625k USDC of liquidity has been deposited for jEUR). A second version of the protocol, without those limitations, will be launched soon.

The protocol is very capital efficient and does not need a high TVL to works. 625k of USDC has enabled since October:

• 3.5M jEUR in circulation ($4M).
• $78M of volume on our primary market.
• 33k swaps by 9k users.
• $20M of transfers (wallet to wallet, excluding swaps).
• $50M on secondary markets (Curve, Kyber).
• $10M of fiat on and off-ramp.
• 10k cumulative holders with 3k jEUR current holders.

Benefits for Aave V3

Fiat on and off-ramp

jEUR has the cheapest and most direct fiat on and off-ramp, which can create a direct bridge between banks and a “Euro savings account” on the Blockchain.

We have multiple non-individuals (companies) who are looking for a place to save Euro on the blockchain without taking the risks of yield farming programs (like on Curve).

Having jEUR on Aave, combined with our fiat on-ramp, would allow this use case to become a reality, and would allow users to borrow jEUR and off-ramp them for Euros.

Large addressable market

A part from the Euro zone, jEUR is a vital part of our African strategy. jEUR can be wrapped into jXAF or jXOF, and we are working on abstracting jEUR for the end-users (people in Africa could deposit jXAF into Aave and earn interest on top of it; in reality, we would unwrap the jXAF for jEUR, but the end-user won’t see it).

jEUR is vital for other Euro stablecoins

jEUR being convertible for USDC at the Chainlink price feed, and being used by other euro stablecoins to maintain their peg and access liquidity (with a few more Euro stablecoins to join the party), it would be a perfect asset to borrow with leverage to perform arbitrages on Polygon.

DDM

jEUR also has a Direct Deposit Module allowing our DAO to mint uncollateralized jEUR and deposit them directly into money markets, to maintain a low-interest rate if needed.

Low risk collateral

As collateral, jEUR is also pretty safe since it always keep its peg and there is no slippage when buying/selling it on our primary market.

jEUR could be used in isolation mode to limit the risk for Aave.

jEUR has no Chainlink price feed but it uses the EURUSD price feed of Chainlink to settle its trades.

Risk Parameters

With the liquidity on Polygon in mind, I propose the following risk parameters. Obviously, this is the first proposition and the governance and risk team is more suited to choose better risk parameters:

1. V3 Efficiency mode EUR stablecoins (if it exists): 97% LTV, 98% liquidation threshold, 10% reserve factor
2. V3 Efficiency mode stablecoins: 90% LTV, 95% Liquidation threshold, 10% reserve factor
3. V3 Isolation mode: 50% LTV, 80% liquidation threshold, 20% reserve factor, 2M$ debt ceiling.

Security specification and risks

Risks inherent to jEUR

Besides obvious smart contract risks, jEUR is over-collateralized with USDC, and therefore inherit from all the risk born by USDC.

jEUR liquidiations are secured by the UMA’s DVM oracle and jEUR trading happens at the Chainlink price feed, therefore jEUR inhereit from the risks of these two protocols.

More informations about the risks

Token (& Protocol) permissions (minting) and upgradability.

jEUR can only be minted following the rules of the protocol on Polygon: users can send $X USDC to the liquidity pool to mint $X of jEUR, or the multi-sig can call the minting function from the DDM module.

There is currently no DAO, only a community-owned multisig (5/8) managing the treasury and two company-owned multisig (2/3), one admin and one maintainer (the admin can only add or revoke a maintainer). The maintainer can upgrade some parts of the protocols: minting and burning fees, address receiving the fees, adding/removing a new jFIAT, adding/removing supported collateral, calling the emergency shutdown function (settle all the jFIAT at the Chainlink price feed); changing the price feed.

It does not have any access/control over any funds. and we are transitioning to a ve-model together with a token rebranding in Q2, accompanying the launch our the protocol v2.

Audits

We have had two different audits by Halborn and Ubik: Read the audits

Data

Market data (Market Cap, 24h Volume, Volatility, Exchanges, Maturity)

• Market Cap: €3.5M circulating ($4M)
• 24h Volume: $2M on our primary market, $400k on secondary markets
• Volatility: Low
• Maturity: Early

Social channels data (Size of communities, activity on Github)

• Discord: 3k members
• Twitter: 16.1k followers

Contracts date of deployments, number of transactions, number of holders for tokens

• Date of Deployment: Sep 2021 (Polygon)
• Number of Transactions: 116k transactions including 30k swaps on our primary market and 22k on secondary markets.
• Number of holders for token: 3,242 (more holders possible due to farming programs)

Links

• Website: https://jarvis.network
• Dune: Jarvis Dashboard
• Docs: https://learn.jarvis.network
• Code: https://gitlab.com/jarvis-network

Voting options

• YES, add jEUR on Aave v3 on Polygon
• NO, do not add jEUR on Aave v3 on Polygon