AIP - 107: Balance sheet consolidation proposal #2

Hello,

Following the first proposal posted last week on the balance sheet consolidation process for the protocol, this is another proposal to continue the balance sheet consolidation process of the protocol.

Context

Contrarily to the previous proposal posted which was mostly about reducing debt ceilings and killing some AMO positions of the protocol. This proposal is about getting rid of some of the tokens and positions that the protocol has accumulated by farming rewards across various protocols or through different acquisitions.

This is notably the case of the MORPHO and wstETH rewards that the protocol has accumulated by lending steakUSDC on Morpho.

Proposal

Proposal is to:

• recover the wstETH and bIB01 token that the protocol has accumulated by lending on Morpho or through previous acquisitions and sell them on the market
• recover the MORPHO tokens on the Transmuter. While these were previously "unsellable" before, due to the upcoming transferability event, it'll be possible for the protocol to take advantage of it to enter in its costs with Morpho farming. When computing the stUSD APR, the protocol estimated that the MORPHO token price was $0.2, it therefore distributed USDA based on the estimation that it'd be able to earn at least 0.2 USDC per MORPHO token farmed. To reduce the risk for the protocol, we suggest post recovery to sell these MORPHO tokens
• sell on the market the veAERO and veVELO NFT positions of the protocol. These were obtained following the acquisition by the protocol of VELO tokens in May 2022. These are currently being used by the protocol to vote for USDA and EURA liquidity pools on Aerodrome and Velodrome. Yet, given that the protocol has enabled on Base 1:1 minting USDA & EURA from USDC and EURC, the protocol no longer needs deep liquidity pools to enable people to get access to the protocol's stablecoins and its savings solutions. The protocol has also made some significant profit from these positions, and taking profit at this time may be a good way to further consolidate equity in the protocol.

For each sale, we propose to sell for USDA to be stored on the protocol USDA treasury address. Process would be to send the tokens to sell the protocol guardian address which can use a deployment EOA (controlled by the signers of the guardian) to smoothly proceed with the token sale. When it comes to veAERO and veVELO positions, given that these positions are locked, we suggest to use OTC deals as well as NFT marketplaces like OpenXSwap to proceed with the sale of the position. Given that the positions are perpetually locked, we should seek on this to seek no less than 0.5 AERO or VELO per AERO/VELO locked in the position.

Value to the protocol

In any case, these proposals would reduce the volatility risk faced by the protocol by holding these tokens and consolidate some of its profits to increase the real equity for the benefit of stablecoin and ANGLE holders.