DIP024 – New Vault for LP Tokens

Summary: A proposal to launch a new Vault that supports USX paired LP tokens.

Background: dForce Vault was launched to onboard a variety of assets as collaterals, allowing USX to be minted against isolated collateral assets with a completely different risk model. Vaults can be customized to support different collateral assets in isolation. We thereby propose to support several liquidity pair LP tokens as collateral to mint USX and improve capital efficiency.

Motivation: Vaults to support USX stablecoin pair LP token on a number of DEXes, allowing USX LP token to be used as collateral to mint USX to further improve capital efficiency. This is beneficial to both LPs and the protocol. For LPs, it can achieve up to 20x leverage over USX stablecoin pairs which will significantly improve capital efficiency. For the protocol, more liquidity will drive demand for USX in the open market and reduce liquidity subsidies.

Proposal: Set up LP Token Vault to support the following LP pairs as collateral to mint USX. Click here to view recommended parameters for respective LP token.