IIP-119 DG1: Launch iMATIC, iETH, BTC2X, iBTC FLIs on Polygon

This is the first of two votes required for a new product to be onboarded to the Index Coop.

A passing vote here signals the Index Coop's intent to further research the iMATIC, iETH, BTC2X, iBTC FLIs on Polygon feasibility resulting in a product prioritization score.

Passing Thresholds:

• 5% or more of circulating supply must participate (2,181,385*0.05 = 109 069)
• 50% or more of participating tokens must vote FOR

FOR - Pass iMATIC, iETH, BTC2X, iBTC FLIs on Polygon through Decision Gate 1. Begin work to research & assign iMATIC, iETH, BTC2X, iBTC FLIs on Polygon a product prioritization score.

AGAINST - Do not pass iMATIC, iETH, BTC2X, iBTC FLIs on Polygon Index through Decision Gate 1.

DG1 is a signaling step to gauge community sentiment. The full-text iMATIC, iETH, BTC2X, iBTC FLIs on Polygon proposal exceeds Snapshot’s character count limit. Below is an abbreviated proposal. Check out this forum post to read the full proposal.

================================================ Title: Launching iMATIC, iETH, BTC2X, iBTC FLIs on Polygon (DG1) Author(s): Pulse Inc Created: 20-Dec-2021 ‌

Simple Summary

Pulse Inc proposes that the Index Coop manages new indices that provide 2x leverage and inverse exposure to the performance of MATIC, ETH, and BTC, using the FLI strategy that was proposed in IIP-13.

Following the launch of ETH2X-FLI-P, these indices will also be launched on the Polygon network. Note: A MATIC2X FLI on Polygon already passed DG2.

Abstract

iMATIC, iETH, BTC2X and iBTC FLIs on Polygon are based on V0.1 of the FLI methodology that is also used for ETH2X-FLI-P on Polygon.

Motivation

Manually maintaining a leverage or inverse position requires continuous monitoring of the health of the position in order to avoid liquidation and incurs high gas fees when the position is frequently rebalanced.

‌Rationale

Flexible Leverage Indices (FLIs) solve this problem by wrapping a collateralized debt position in a single token that can be bought and sold on an exchange and by socializing implementation costs. Furthermore, FLI’s unique index algorithm reduces rebalancing needs by an order of magnitude. Emergency deleveraging is possible during Black Swan events for additional safety.