JIP-17 Launching USD Tranching Vault

TL;DR

DAO approval requested to fund a USD tranching protocol with managed yield vaults to restart protocol revenues, progressively restore asset backing, reduce bad debt, and rebuild long-term value for JARVIS holders.

Budget: €40k (€30k stablecoins + €10k JARVIS). Led by a core Jarvis developer.

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Objective

Restart sustainable protocol revenue generation via: • Managed yield vaults • Tranching (senior / junior) • Yield-bearing USD stablecoin

Goals: • Restore economic activity • Gradually reduce bad debt • Rebuild TVL, confidence, partnerships • Enable real yield for JARVIS staking

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Background

Last 2 years: • Midas hack + 0xVix hack → liquidity & backing loss → bad debt • TVL & revenues down ~90% • Loss of users, liquidity, partners, visibility • Death spiral: lower revenue → fewer incentives → lower TVL

Fundraising: • $1.3M raised (voluntarily capped; hindsight: insufficient) • Expenses: • $200k audits • ~$300k marketing (Mt Pelerin sponsorship + ETHCC events) • Burn rate >$50k/month (non-US salaries) • Treasury converted to stablecoins (that was a mistake, ETH was ~$300–400 back then)

Despite treasury yield generation: • By mid-2024, company had no cash left

Since 2024: • I personally maintained operations • $200k/year injected • Team reduced to 2 people (Alessandro + me) • No JARVIS sold, quite the opposite + I remained LP (which led me to hold now ~25–30% of the supply)

Ethical stance: • Could have stopped, chose not to • Owe holders & contributors an attempt at recovery • Proposal is a collective restart with the DAO • Community help (marketing, comms, partnerships) welcome

Core point: • Revenue generation is the only path to: • Restore jEUR, jCHF backing • Reduce bad debt • Rebuild confidence • Re-enable JARVIS staking yield

Note: • Separate proposal may fund Fordefi licence (~€30k) for strategy execution.

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Proposal

Architecture

Managed Vaults • USDC deposits • Active strategies: • DeFi lending & arbitrage • Delta-neutral • Looping / basis trades • Selected CeFi strategies

Tranching • Senior tranche (USD stablecoin): • Capital stability • Protected by junior • Transferable or stakable • Junior tranche: • First-loss absorber • Higher yield • Insurance layer

USD Stablecoin • Minted from senior tranche • Yield-bearing when staked • Freely transferable when unstaked

Future expansion • EUR and other fiat currencies • Aligned with Jarvis’ original mission

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Development & Budget • Led by core Jarvis developer • Timeline: 4–5 months • Budget: • €30k stablecoins • €10k JARVIS • Paid from DAO treasury

Scope: • Smart contracts • Vault & tranching logic • Stablecoin minting & staking • Testing & deployment support

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Stakeholders • DAO / Treasury: new revenue engine • JARVIS holders: long-term value via revenues • Stablecoin users: yield-bearing USD with clear risk • Junior tranche investors: higher yield, defined risk

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Risks & Mitigation

Risks: • Strategy underperformance • Execution risk • Market volatility • Active management trust

Mitigation: • Tranching (loss absorption) • Conservative parameters • Gradual rollout • DAO oversight

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Conclusion

This is a strategic reset, not an incentive patch.

DAO funds: • Sustainable revenue • Balance-sheet recovery • Long-term value for JARVIS holders