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[BIP-913] Enable Gauges for svZCHF/ZCHF and ixEDEL/USDC on Ethereum

Voting ended 18 days agoSucceeded

Summary

This is a proposal to enable two gauges on Ethereum via a single combined payload:

svZCHF/ZCHF Pool — Gauge 0x54839a2fe079a21311127f3d811ec8c7afd0a2e9 for pool 0x849d43118c2e3c4856af26ee96f1a9d72bc2774f (svZCHF-ZCHF)
ixEDEL/USDC Pool — Gauge 0x6732ed78bf1d8afa3ef03f1ead302d21b0b2b1ff for pool 0x37081447540b194d8e9aa2df95309dc830da8f11 (ixEdel-USDC)

Both pools are deployed on Ethereum Mainnet using Balancer v3. These represent the first and only on-chain liquidity venues for both svZCHF and ixEDEL on any DEX.

References / Useful Links

Frankencoin (ZCHF / svZCHF):

Website: https://www.frankencoin.com
Documentation: https://docs.frankencoin.com
GitHub: https://github.com/Frankencoin-ZCHF/FrankenCoin
Savings module (svZCHF): https://savings.frankencoin.com
svZCHF Mint/Swap: https://app.openocean.finance/swap/eth/ZCHF_0xb58e61c3098d85632df34eecfb899a1ed80921cb/SVZCHF_0xE5F130253fF137f9917C0107659A4c5262abf6b0
CoinGecko (ZCHF): https://www.coingecko.com/en/coins/frankencoin

Reserve Protocol (ixEDEL):

Website: https://reserve.org
Documentation: https://reserve.org/protocol/faq
GitHub: https://github.com/reserve-protocol/reserve-index-dtf
Index DTF Security & Audits: https://docs.reserve.org/core-components/index-dtfs/security#smart-contract-security-audits
ixEDEL Overview (Mint/Redeem): https://app.reserve.org/ethereum/index-dtf/0xe4a10951f962e6cb93cb843a4ef05d2f99db1f94/overview
GeckoTerminal: https://www.geckoterminal.com/eth/pools/0x37081447540b194d8e9aa2df95309dc830da8f11

Sagix (Pool Deployer / ixEDEL Manager):

Website: https://www,sagix.io
ixEDEL Fact Sheet: https://www.sagix.io/ixedel/

Balancer Pools:

GitHub PR:

https://github.com/BalancerMaxis/multisig-ops/pull/2692

Protocol Description

svZCHF (Savings Frankencoin)

svZCHF is the ERC-4626 savings vault wrapper for Frankencoin (ZCHF), the largest Swiss franc stablecoin on Ethereum. ZCHF is a collateralized, oracle-free stablecoin that tracks the value of the Swiss franc. It has been live since 2023 with no significant depegs.

svZCHF accrues yield from Frankencoin’s savings module, currently earning approximately 3.75% APY in CHF terms. The savings rate is determined by protocol governance and funded by borrowing fees. svZCHF is a yield-bearing token — its exchange rate against ZCHF increases monotonically over time.

ZCHF price: ~$1.31 (CHF-pegged), sourced from CoinGecko. Frankencoin is the largest CHF stablecoin with a market cap of approximately $12M.

ixEDEL (Sagix Club Edelweiss)

ixEDEL (Sagix Club Edelweiss) is a Decentralized Token Fund (DTF) deployed on Reserve Protocol’s Index DTF infrastructure. It is a defensive, multi-asset portfolio designed to preserve purchasing power across market regimes. Current basket composition:

Frankencoin ZCHF — 24.39% (Swiss franc stablecoin)
Tether Gold XAUt — 20.67% (tokenized gold)
Savings USDS sUSDS — 20.51% (yield-bearing USD stablecoin)
Steakhouse USDC steakUSDC — 15.75% (yield-bearing USDC vault)
Coinbase Wrapped BTC cbBTC — 13.25% (Bitcoin)
Syrup USDC syrupUSDC — 5.43% (yield-bearing USDC vault)

ixEDEL is fully backed 1:1 by its underlying assets and can be minted/redeemed permissionlessly at any time via the Reserve Protocol interface. Current TVL is approximately $42K.

Motivation

These are primary markets, not fragmented liquidity. Neither svZCHF nor ixEDEL has any other liquidity venue on any DEX. Balancer is the exclusive secondary market for both tokens. Every LP position on these pools represents net-new on-chain liquidity rather than fragmenting existing depth from other venues.

Double protocol value creation. To LP in the ixEDEL pool, users must first mint ixEDEL on Reserve Protocol. This drives Reserve mint volume, and subsequent trades generate Balancer swap fees. The svZCHF pool similarly benefits Frankencoin by increasing demand for the savings vault. Each pool drives activity across two protocols simultaneously.

Unique asset class for Balancer. svZCHF offers the only CHF-denominated yield-bearing asset on Balancer — and potentially on any DEX. This is a differentiated asset class that expands Balancer’s catalog beyond the heavily competed USD yield market.

Path to Pendle. With sufficient liquidity depth, svZCHF is a candidate for Pendle’s first non-USD fixed income market (PT-svZCHF), which would drive additional volume back through Balancer as the primary liquidity source.

svZCHF improves ixEDEL composition. The svZCHF pool directly enables ixEDEL’s planned collateral migration from non-yielding ZCHF to the yield-bearing svZCHF, improving the DTF’s returns while generating swap volume through Balancer.

Specifications

Governance

Frankencoin: Governed by Frankencoin Pool Shares (FPS) holders. The system uses a veto-based governance model — new minters can be proposed by anyone paying a 1,000 ZCHF fee and are accepted unless vetoed by shareholders controlling at least 2% of voting power within the application period. The Frankencoin Association is a Swiss non-profit based in Zug that supports the ecosystem but does not control the protocol. Contracts are non-upgradeable.

Reserve Protocol: DTFs are governed separately by their respective stakers or vote-lockers. Core contracts are only upgradable via governance proposals approved by on-chain governance. Each DTF can have an entirely different governance system. ixEDEL is managed by the Sagix Foundation deployer address.

Pool Deployer: Pools were created by sagix-druid (www.sagix.io). Pool parameters are set at creation and follow Balancer v3 defaults with StableSurge hook on the svZCHF/ZCHF pool.

Oracles

Frankencoin: Does not rely on external oracles. This is a core design principle — the system uses an economic auction mechanism for liquidations rather than oracle-triggered liquidations.

Reserve Protocol: Uses Chainlink oracles for collateral pricing within the DTF basket. Individual collateral plugins interface with price feeds to determine basket valuations.

svZCHF Rate Provider: Approved and merged by the Balancer code-review team. The rate provider reads the ERC-4626 share price directly from the svZCHF contract.

Audits

Frankencoin:

ChainSecurity — Smart Contract Audit (2023): https://www.chainsecurity.com/security-audit/frankencoin-smart-contracts
ChainSecurity — v2024 Update (Savings module): https://www.chainsecurity.com/security-audit/frankencoin-v2024
ChainSecurity — CCIP Bridge: https://www.chainsecurity.com/security-audit/frankencoin-ccip-bridge
Code4rena — Competitive Audit (2023): https://code4rena.com/reports/2023-04-frankencoin
BlockBite — Audit (2023): https://www.blockbite.ch/audits/Frankencoin.pdf

Reserve Protocol:

Security & Audits (Index DTFs): https://docs.reserve.org/core-components/index-dtfs/security#smart-contract-security-audits
Halborn — Smart Contract Audit: GitHub
Code4rena — Release 3.0.0 Core: GitHub
Code4rena — Release 3.0.0 Collaterals: GitHub
Index DTF Audits: GitHub

Centralization Vectors

Frankencoin: Minimal centralization. No admin keys, no upgradeability, no oracle dependencies. The Frankencoin Association is a Swiss non-profit that supports but does not control the protocol. Governance is fully on-chain via FPS holders with a veto model.

Reserve Protocol: Core contracts are upgradable only through on-chain governance. Individual DTFs can have deployer-managed governance. ixEDEL is currently managed by the Sagix deployer address, which controls basket composition and fee parameters. Smart contract risk is diversified across multiple underlying protocols (Aave, Compound, etc.) through the collateral basket.

Pools: Pool parameters are immutable post-creation on Balancer v3. The pool creator has no special privileges over pool operation.

Market History

ZCHF: Live since April 2023. Tracks the Swiss franc at approximately $1.31 USD. No significant depegs observed. Market cap ~$12M. The largest CHF stablecoin on Ethereum.

svZCHF: Savings vault for ZCHF. Exchange rate increases monotonically as yield accrues. No depeg risk in CHF terms — it is a wrapped savings position, not a separate stablecoin.

ixEDEL: Launched in 2025 as a multi-asset defensive portfolio. During a recent market correction where Bitcoin declined ~25%, ixEDEL declined only ~1.5%, demonstrating the anti-fragile design thesis. Current TVL ~$42K.

Pool Activity:

svZCHF/ZCHF pool: 0x849d43118c2e3c4856af26ee96f1a9d72bc2774f — Balancer Link
ixEDEL/USDC pool: 0x37081447540b194d8e9aa2df95309dc830da8f11 — Balancer Link
svZCHF gauge: 0x54839a2fe079a21311127f3d811ec8c7afd0a2e9
ixEDEL gauge: 0x6732ed78bf1d8afa3ef03f1ead302d21b0b2b1ff

Both pools are newly deployed. Initial liquidity is bootstrapping. These are primary markets with no competing venues.

Value

Both pools are the sole source of on-chain liquidity for their respective tokens. There is no other DEX, AMM, or order book offering svZCHF or ixEDEL trading. This means:

All swap volume for these tokens flows exclusively through Balancer
BAL incentives would bootstrap genuinely new liquidity rather than competing with existing venues
As these ecosystems grow (Frankencoin expansion, Reserve DTF adoption), Balancer captures 100% of the secondary market

Fee generation potential: The svZCHF pool uses the StableSurge hook, which increases fees during depeg events — providing higher returns to LPs precisely when liquidity is most needed. Under normal conditions, the stable swap math enables tight spreads and capital-efficient trading.

Technical Specification

The Balancer Maxi Omni-Sig 0x9ff471F9f98F42E5151C7855fD1b5aa906b1AF7e will interact with the GaugeAdderV4 at 0x5DbAd78818D4c8958EfF2d5b95b28385A22113Cd and call the addGauge function with the following arguments:

Gauge 1 (svZCHF/ZCHF):

gauge(address): 0x54839a2fe079a21311127f3d811ec8c7afd0a2e9
gaugeType(string): Ethereum

Gauge 2 (ixEDEL/USDC):

gauge(address): 0x6732ed78bf1d8afa3ef03f1ead302d21b0b2b1ff
gaugeType(string): Ethereum

Payload PR: https://github.com/BalancerMaxis/multisig-ops/pull/2692

Off-Chain Vote

Yes, let's do it

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