Allowlist BarnBridge as a Fuse Pool Creator

Summary If passed, the BarnBridge DAO would be allowlisted as a Fuse Pool creator. The BarnBridge DAO would focus on bootstrapping pools for its derivative ERC-20 assets from both SMART Yield (e.g., junior tranche tokens) and SMART Alpha (e.g., junior as well as senior tokens).

BarnBridge's market capitalization oscillates between $75M and $125M, while its SMART Yield product has once reached a high-water mark of $299M in TVL. SMART Alpha, an application for calibrating exposure to asset price volatility of any ERC-20, will launch by mid-September.

You can learn more about us here:

• App Homepage
• Dune Dashboard for SMART Yield
• Dune Dashboard for BarnBridge Governance
• Twitter
• Discord

Background BarnBridge is a risk tokenization protocol for DeFi. Its applications allow users to select from opposing pools, referred to as tranches, and take positions on risk factors like interest rates or asset prices. Its first application, SMART Yield, offers fixed and levered variable yields on stablecoins deposited into underlying lending markets like Aave, Compound, and C.R.E.A.M. Finance. Its application suite has expanded to include SMART Exposure, a position rebalancing solution, as well as SMART Alpha soon, which will allow users to calibrate their exposure to price movements in an underlying digital asset. BarnBridge is currently live on Ethereum and the Polygon Network.

Motivation We've been considering Fuse Pools for a while but have held off to date due to a) lack of secondary liquidity for our SY jTokens, and b) competition from our own rewards pools for those jTokens. Now that those jTokens rewards lapse on August 8th and Aavegeddon is behind us, the time is ripe to take the plunge.

We would look to roll out two fuse pools over multiple phases.

Phases 1 and 2 would center on the creation of what will become the SMART Yield pool, pending the provisioning of liquid Uniswap v3 pools for jTokens for appropriate liquidity and price feeds.

• Phase 1: BOND/USDC/ETH

• Phase 2: BOND/USDC/ETH/bb_cDAI/bb_cUSDC/bb_cUSDT/bb_aDAI/bb_aUSDC/bb_aUSDT/etc.

Phase 3 would center on the creation of the SMART Alpha pool. SMART Alpha will allow users to seed pools for a given ERC-20 with a junior and senior side, offering exposure to levered and dampened asset price volatility depending on the ratio between the two sides. It's set to launch by mid-September. As we get liquid secondary pools for these perpetual senERC-20 and junERC-20 tokens, they would be added here.

• Phase 3: BOND/USDC/senETH/junETH/senWBTC/junWBTC/etc.

Potential Benefits There are three prongs along which the BarnBridge <> Rari partnership could prove fruitful.

• SMART Alpha Assets: SMART Alpha senior tokens give up relative upside in order to receive absolute downside protection. This makes the SA senior versions of any ERC-20 a compelling collateral type. A BarnBridge Fuse pool will make it straightforward to showcase the pristine nature of these derivative assets, rather than having to argue in theory with the governance of other platforms. Note, these senior tokens will need to achieve appropriate secondary liquidity of their own for liquidation to be possible.

• BarnBridge DAO Assets: The BarnBridge DAO currently holds a third of BOND token supply. Access to a credit line through a Fuse Pool could be compelling for that reason alone, but the DAO will accrue fees over time that it could leverage here as well.

• SMART Yield Junior Tokens: Junior tokens provide users with levered exposure to underlying interest rates in the stablecoins they deposit. While these are not secured positions, given that they are responsible for paying the yields of senior pool depositors on the other side, adding additional utility through a Fuse pool could make users more comfortable in participating with their capital.

Vote Details

• FOR: Whitelist the BarnBridge core team multisig as a pool creator on the Rari Fuse platform.
• AGAINST: Do nothing