Theme

With IIP-20 the development of IPOR Fusion was decided. IPOR Fusion is released in a rolling launch. Shortly after IIP-20, the launch of a USDC Fusion vault on Arbitrum was decided in IIP-21. It has now been successfully launched and connected to the asset management of the USDC AMM pool on Arbitrum after the smart contracts have been audited. The first stage of the IPOR Fusion launch was thus completed. This IIP applies to the second stage.

Asset management

Additional closed Fusion vaults are to be set up for the asset management of the IPOR AMM pools, in particular for the following:

• IPOR USDC pool (mainnet, lending optimizer)
• IPOR USDT pool (mainnet, lending optimizer)
• IPOR stETH pool (mainnet, leveraged looping)
• IPOR wstETH pool (Arbitrum, leveraged looping)

Lending Optimizer: Allocates assets on different protocols such as money markets with the goal of optimizing yield.

Leveraged Looping: Deposits stETH on money markets, borrows ETH against it and swaps it for more stETH, which is again deposited at the same money market to borrow more ETH. The Strategy automatically shifts the position to the money markets with the lowest borrowing cost with the goal of optimizing yield.

The details will be determined by the economics workgroup.

Whitelisted Atomists

In recent weeks, discussions have been held between IPOR Labs and numerous interested potential Atomists (strategy creators and curators). Some of these Atomists, who have different backgrounds and strategic approaches, have been identified as particularly suitable for setting up an IPOR Fusion vault. They will be whitelisted and will be able to set up an IPOR Fusion vault before the protocol becomes completely permissionless (see Stage 3).

For reasons of confidentiality, no names will be mentioned at this time. The names will be announced soon, but no later than the time of the launch of the respective vaults.

Points Program

To provide an incentive for users and Atomists to use and build on IPOR Fusion, a points program will be set up. Points can be exchanged for a token at the end of the program. The details of the points program, including the duration of the program, will be determined by the economics workgroup.

Fees

There are two types of fees that can be charged in a Plasma Vault:

• Performance fee - charged as a percentage of the increase of the exchange rate between vault's underlying asset and the vault token.
• Management fee - charged on the vault's annualized TVL.

The Atomists configure both fees. The IPOR DAO also earns part of both fees to support its operations.

The fee rates are as follows:

IPOR DAO managed closed Fusion vaults (used for asset management of the AMM pools):

• management fee: 1% annualized
• performance fee: 10%

all other Fusion vaults:

• management fee: 0.3% annualized
• performance fee: 2%

The collected fees will be issued in the form of vault token shares.

Fuses

To date, fuses have been built for the following protocols and used in the USDC vault on Arbitrum:

• Aave v3
• Compound v3
• Fluid
• Gearbox
• Uniswap
• MakerDAO DSR

Additional fuses are being built, particularly for the following protocols:

• Morpho
• Curve
• GMX
• Euler
• Ramses
• Camelot
• Velodrome

This list is not exhaustive and additional protocols will be added as required by the Atomists.

Stage 3

After the completion of Stage 2, IPOR Fusion is expected to be permissionless in Stage 3, allowing anyone to become an Atomist and create their own Plasma Vaults.

Timeline/Steps

1. Discussion: Discussion in the open governance forum for 3 days.
2. Vote: After this period the proposal will be moved to #formal-governance and a Snapshot vote will be held.
3. Implementation: As soon as the workload of the IPOR Labs developers allows it.
4. Monitor and evaluate the changes: After the changes have been implemented, it will be important to monitor their impact on IPOR and the community.

Cost Estimation

The IPOR Labs team has already signaled that the costs considered for developing an initial version of IPOR Fusion falls within the software development scope and services rendered and paid for from the protocol’s initial funding.

Commitment

Transparency: IPOR Labs will have a commitment to being transparent about the development and implementation of the proposal. This will include providing regular updates on the progress of the changes and sharing any relevant data or information with the community. Community engagement: IPOR Labs will actively engage with the IPOR community throughout the development and implementation of the proposal. This will include soliciting feedback from the community and incorporating their suggestions and concerns into the proposal. Responsiveness: IPOR Labs will be responsive to any questions or concerns raised by the IPOR community about the proposal. This will include providing timely and accurate responses to any inquiries from the community. Accountability: IPOR Labs will be accountable for the impact of the proposal on the IPOR Protocol and its community.