Summary

This proposal outlines a strategic partnership between RAAC and Protocol f(x), establishing RAAC to friendly fork f(x) Protocol. Through this partnership, we aim to integrate f(x) Protocol and fxUSD into RAAC, providing benefits to both communities and establish a collaborative framework for ongoing development and liquidity support.

Background

As RAAC prepares to launch its first Silo, this development represents a significant milestone for RAAC . The fork will be based on the f(x) Protocol’s V1 framework but with targeted adaptations to optimize its performance and alignment within RAAC’s ecosystem based on the RWA Silo. Recognizing the shared goals and potential for mutual growth, RAAC suggests that the teams negotiate terms for a friendly fork of f(x) Protocol.

By structuring this partnership, we aim to leverage the strengths of the f(x) Protocol’s established framework while ensuring it meets the unique needs of RAAC’s RWA Silos. The collaboration will focus on building liquidity, expanding collateral options, and creating additional revenue opportunities for both protocols.

Proposed Terms and Structure

• Profit Share: RAAC will allocate 5% of the minting fees generated by the fork of f(x) Protocol, in perpetuity. This profit-sharing model supports Protocol f(x) and aligns both parties’ interests for shared success for the foreseeable future.
• Integrations: Collateral Integration: fxUSD will eventually be integrated as a lending collateral option within the RAAC ecosystem, expanding the collateral choices available to users and increasing flexibility within the RAAC platform. As well as auto-compounder and potentially vault integrations of f(x) Protocol based products.
• Community and Liquidity Support: Protocol f(x) will assist RAAC in establishing relationships within the f(x) community, co-marketing efforts, and liquidity initiatives. This collaboration includes pairing fxUSD with other assets, building depth in liquidity pools, and fostering mutual community engagement.

Regulatory Compliance and Liability

Protocol f(x) waives any liability related to regulatory actions concerning assets that RAAC integrates into the platform. RAAC assumes full responsibility for ensuring compliance with regulatory requirements, including any designations as securities or otherwise in regards to launching and managing the f(x) Protocol fork. This provision enables both parties to operate with a clear understanding of their respective roles and responsibilities regarding regulatory considerations.

Goals

• Enhance Deposit Options: The integration of f(x)USD as an asset for lending provides a stable ETH/BTC backed asset for users within the RAAC ecosystem.
• Aligned Incentives for mutual growth: The profit-sharing agreement creates a new revenue stream for Protocol f(x), incentivising the f(x) community to help RAAC grow.
• Increased Liquidity and Market Depth: Co-marketing and liquidity pairings with f(x)USD foster liquidity and engagement, benefiting both communities by enhancing trading opportunities and market access.

Expected Fees From Revenue Share

Our partners Pretio Digital want to start with 1 million ounces but deposit 4 million as quickly as possible, and will have an approximately 15 year production life cycle. The expected fees are provided based on the one initial partnership, and not any other gold/precious metal deposits or Silos we decide to bring on chain.

Structure

2% Mint fee will be charged.

f(x)’s share is 2% * 0.05 = 0.10% of mint fees to f(x) Protocol

Present Value of 1 million ounces with 80% discount = $665.8 Million

f(x) Share = $400 million stables * 0.10% = $400,000

Future Value of 1 million ounces spot value = $3.329 Billion

f(x) Share = $2 Billion stables * 0.10% = $2,000,000

Present Value of 4 million ounces with 80% discount = $1.6 Billion

f(x) Share = $1.6 Billion stables * 0.10% = $1,600,000

Stables minted from Future Value of 4 million ounces spot value

f(x) Share = $8 Billion stables * 0.10% = $8,000,000

*GOLD spot price of $3,329