QIP249: Onboard USDC to QiDao Ethereum PSM

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network: Ethereum author: 0x7c59bc02fb160a3a0225d69E9fb125D328ED7986 implementor: DAO created: 2025-11-11

Summary

Approve USDC (0xA0b86991c6218b36c1d19D4a2e9Eb0cE3606eB48) on Ethereum as collateral for a new QiDao Peg Stability Module (PSM). The PSM will allow users to deposit USDC and mint MAI at a 1:1 ratio and to redeem MAI back to USDC, within defined limits and fees, to stabilize the MAI peg and ensure deep on-chain liquidity on Ethereum.

Abstract

This proposal introduces a Peg Stability Module on Ethereum that accepts USDC as collateral and mints MAI at a 1:1 ratio against deposited USDC. Users will also be able to redeem MAI back to USDC at a 1:1 ratio, subject to capacity limits, fees, and withdrawal parameters. The PSM will deploy USDC reserves into Beefy as a yield aggregator to facilitate compounding. For Ethereum, the current preferred strategy is to use Morpho with Steakhouse as curator, subject to risk parameters and liquidity needs.

The design follows the existing PSMs deployed on Base, Polygon PoS, and Linea. Unlike the Metis m.USDC PSM, Ethereum has multiple conservative venues for deploying stablecoin reserves.

Motivation

QiDao’s current setup on Ethereum limits direct access to MAI liquidity and the ability for vault users, farmers, and arbitrageurs to rely on a tight and robust MAI peg backed by a deep, instantly accessible stablecoin reserve. The absence of a PSM on Ethereum means MAI’s peg stability depends heavily on DEX liquidity and slippage.

Deploying a USDC-based PSM on Ethereum will: Guarantee MAI liquidity at $1 by allowing anyone to mint or redeem MAI with USDC, reduce dependency on external DEX liquidity, especially during market stress, stabilize MAI’s peg on mainnet through native arbitrage opportunities and improve user and market confidence in MAI and QiDao’s Ethereum deployment by offering predictable and permissionless access to stability.

Specification

USDC on Ethereum at address 0xA0b86991c6218b36c1d19D4a2e9Eb0cE3606eB48 will be approved as collateral for a new Peg Stability Module. Users will be able to deposit USDC into the PSM and mint MAI at a 1:1 ratio, within the capacity and risk limits defined by governance. Users will also be able to redeem MAI for USDC at a 1:1 ratio, subject to the withdrawal fee and the configured withdrawal period.

The PSM's reserves will be deployed into conservative, DAO-approved strategies on Ethereum in order to generate yield. The current preferred approach is to use Morpho with Steakhouse as curator, following the pattern of previously approved strategies, and Beefy as yield aggregator to facilitate compounding the yield.

Future changes to the underlying strategy for USDC reserves may be executed without a new vote, provided that the new destination offers more optimal risk-adjusted yield, does not introduce additional third-party risks, and remains limited to blue-chip stablecoin collaterals and already approved partner platforms and curators.

Rationale

Ethereum offers a richer set of conservative, battle-tested options for deploying USDC reserves than some other networks. By leveraging strategies such as Morpho with Steakhouse as curator, the protocol can both strengthen the MAI peg via a deep USDC backstop and earn additional protocol revenue on idle reserves. Rather than relying exclusively on the 0.3% redemption fee, QiDao can diversify its income with carefully risk-managed yield, while still prioritizing safety and liquidity.

This design balances peg stability, revenue generation, and conservative risk management. It reuses patterns and partners that have already been vetted and approved by the DAO on other chains, which reduces implementation and governance friction.

Technical Specification

Control over deploying a portion of the PSM’s USDC reserves into external yield strategies, such as Morpho with Steakhouse, will be handled by QiDao governance or its designated executor. Any integrations must follow the Specification and future-proofing conditions described above, including constraints on allowed venues, collateral types, and risk profiles.

Configurable Values

Deposit fee: $0, withdraw fee: Greater of $1 or 0.3%, withdraw period: 3 days

Transactions

[
  {
    "multisig": "0x3182E6856c3B59C39114416075770Ec9DC9Ff436",
    "transactions": [
      {
        "chainId": 1,
        "to": "0x8D6CeBD76f18E1558D4DB88138e2DeFB3909fAD6",
        "function": "transfer",
        "args": [
          "0x7a4ddc19530db345f05ffe75b3086b04d3b1d99c",
          "100000000000000000000000"
        ],
        "value": "0",
        "annotation": "Transfer 100K MAI to seed the initial Ethereum PSM debt ceiling"
      }
    ]
  }
]