Incubate Y2K Finance

Voting ended over 3 years agoSucceeded

The purpose of this DAO proposal is to make Y2K Finance our next incubated project.

What is Y2K?

Y2K Finance is a suite of structured products we have designed for exotic peg derivatives, that will allow market participants the ability to robustly hedge or speculate on the risk of a particular pegged asset (or basket of pegged assets), deviating from their 'fair implied market value'.

The protocol brings three main products to the table:

Earthquake

This flagship Y2K structured product leverages a variant of the ERC-4626 standard for the creation of fully-collateralized insurance vaults. Users can use these vaults to hedge, speculate and underwrite the volatility risk associated with various pegged assets. Token holders are rewarded from trading fees derived from this marketplace

Tsunami

Tsunami is a Collateralized Debt Obligation (CDO) powered lending market for pegged assets with MEV-proof liquidations.

Wildfire

Wildfire is an on-chain RFQ orderbook where users can trade Y2K risk tokens amongst themselves, both unlocking ample liquidity and allowing for rapid repricing of semi-fungible tokens.

How does Y2K work?

When Y2K launches, Earthquake will be the first product on offer. The way it works is a user can 'purchase' insurance on a de-peg event on any of our supported assets by depositing ETH to the corresponding "Premia" vault. Conversely, they can "sell" insurance by depositing ETH in the "Collateral" vault.

Each pair of vaults has the following properties:

Asset: The specific pegged asset the vault is trading.

Epoch: The start and end date of the vault.

Strike: How far from peg the pegged asset price needs to deviate in order to trigger a liquidation event and hence a payout to the "Premia" vault depositors.

Participants can deposit into Y2K vaults at any time before the epoch start date, after which funds are locked for the duration of the epoch. Chainlink oracles are used to monitor pegged asset prices, and in the scenario where an asset de-pegs to a degree larger than the strike of a vault pair, the contents of the collateral vault are liquidated and awarded to the premia vault depositors.

In the event of no de-pegging over the course of an asset's insurance epoch, both premia and collateral payments are delivered to the insurance sellers. It's important to note that insurance sellers receive premiums regardless of whether there was a liquidation event, and all cash-flows occur at the end of the epoch. The protocol collects a 5% fee from risk collateral yield and a .25% fee from premiums and collateral deposits.

How will this look for New Order?

Once this proposal and the subsequent snapshot is approved by the DAO, New Order will provide technical, fundraising, strategy, and marketing support to the Y2K team until its launch date. In exchange for these services New Order DAO treasury will receive a 10% allocation of the total supply of Y2K tokens.

Vote "Yes" if you are FOR incubating Y2K finance, Vote "No" if you are against incubating Y2K finance.