[TFIP-25] Bastion Trading as Additional MM for TRU Token

Truefi Additional Market Maker

Introduction

Truefi has been a long time standing token with who was the pioneer in the uncollateralized and undercollateralized lending crypto space with prestigious centralized exchange listings.

Bastion Trading

Bastion Trading has been trading cryptocurrencies since 2017 across various CEX and DEX platforms, as a proprietary trader and market maker. Bastion Trading is no stranger to Truefi being one of the first borrowers on the Truefi platform starting in 2021.

Currently Bastion Trading trades billions of dollars monthly across cryptocurrency tokens, coins, options, swaps and other derivatives on various centralised and decentralised exchanges. Bastion Trading also has provided market making services since 2018, and adjusting strategies across multiple market cycles.

Proposal

Bastion Trading aims to increase the liquidity profile of various CEX token and derivatives markets. The identified markets are to augment liquidity on Binance, while providing orderbook depth to Kraken spot markets, and Bybit swap markets. The goal is to increase order book health to encourage more volumes across trading venues for the TRU token. Given the state of the Truefi treasury in the timelock contract where a retainer model less feasible, Bastion Trading proposes the following TRU token loan with option market making contract (where Bastion Trading will provide the stablecoin side of the capital):

Token Loan Amount: 9,000,000 TRU

Tenure: 24 months from the market making start date.

Market Making Objectives:

On Touch Bid-Ask Spread: 30 bps

Minimum Depth Provided per 2% from mid-market: USDT 40,000 across all venues

Target Venues: Binance, Bybit Swap, and either of Kraken or Coinbase (with lean to Coinbase)

SLA (Uptime): 24/365 95%

Call options provided by Truefi: there are two call options and each gives Bastion Trading the option (not obligation) to purchase the loaned tokens 24 months from the market making start date at following amounts and strike prices:

Call Option 1: The option to purchase 50% of loaned tokens (4,500,000 TRU) at strike price 1, which has 17% premium to the spot price reference of when Bastion receives the tokens from Truefi.

Call Option 2: The option to purchase 50% of loaned tokens (4,500,000 TRU) at strike price 1, which has 32% premium to the spot price reference of when Bastion receives the tokens from Truefi.

Next Governance Steps As the proposals does not fall under the simplified governance exemptions, the proposal will require the following steps:

Amendment Period: If the 5% quorum is met, with a majority negative vote, a 72-hour period will follow to allow for any amendments or discussions before the proposal is posted to Tally.

Tally Vote: Otherwise, the proposal will be posted to Tally for the final vote.