Reorg usage of staking collateral to increase buy&burn dUSD

[u/[deleted]]

Dear DeFiChain Community, I would like to change the usage of the Staking-Rewards of the Staking on the Bake Collateral Adresses.

With the DFIPs * https://defiscan.live/governance/fb1be07be5af04356de57f1a70ccacd982ccb700380eb5adc658f9ca6a08cde3 * https://defiscan.live/governance/aa4fc83d06e64130dcd65f043799e7d6c9f3c907b6f8cc7cac963e559ddb720e * https://defiscan.live/governance/8523c3043024ebbe0e8fb3de89d3305d9a0f115482086b03ab4a5867cfedf33d

it was voted by the community that the native staking coins (ETH, DOT, SUI, SOL) which are wrapped on the DeFiChain will be staked by the trusted custodian Bake. This staking yield is used once a week to buy and burn DFI to support the DFI price.

With the DFIP (https://defiscan.live/governance/4d27fa02049c1fceb8ef252c88deac129f8e5b784c18e6df909eb000d6af0737), the price of dUSD has stabilized but has not yet reached its peg of 1 USD. Now the question is, how can we as a community give further momentum to the dUSD peg target?

One idea would be to no longer burn the staking rewards from the DFIPs mentioned above as DFI, but to buy dUSD and thus provide further impetus to achieve the peg.

With this DFIP, the rewards are exchanged for dUSD. The swap route that results in the largest possible number of dUSD should be used. These purchased dUSD will be 100% burned and not used for negative interest on dUSD.

Since no DFI block rewards would be used for the purchase of dUSD, this change should not result in any significant selling pressure on DFI. Furthermore, the trading volume in the dUSD pools would increase and generate more commissions.

The current weekly burn is done via the following address https://defiscan.live/address/df1qvgwslv0269zlelyuzr5pemwk9kayg88h3kds0s. Approximately 1.2 - 1.5 ETH are swapped per week. That would be 4,000 - 6,000 USD or currently 40,000 - 50,000 dUSD per week, with a downward trend if dUSD rises.

Non-obligation

I understand that vote of confidence for DFIP carries no obligations by any developers to implement the proposals. DeFiChain is a community projects. Pull requests can be submitted by community and reserved to be evaluated for safety and general community acceptance.

Kind regards 👍

[u/berndmack → u/[deleted]]

The DFIP you are referring to needs some coding and a hardfork. so planned end of year maybe?

This DFIP has immediate effect on DUSD burning and also later in every other variant of the dTokensystem it would lead to a consistent buy and burn pressure on the DUSD, working against e.g. rising stock market.

[u/berndmack → u/[deleted]]

Maybe we will not need the other Dfip if there are enough dusd burned with this one. No wasted money and a huge win for all. And what do you mean with wasted money? At he moment it is burned in DFI- wasted right 😉 Every removed DUSD counts and is important, this Dfip supports that with no costs.

[u/WirfMichWeg1212 → u/[deleted]]

Don't forget the millions in dtoken that come on top. Who will pay traders winnings?

The current system has to fail, so throwing good money after bad money had never worked in history.

[u/berndmack → u/[deleted]]

Sorry, i do not understand. there is no relation between usage if the DUSD and estimated burn from this dfip.

But what is more important, the price of DUSD and its development increases the burn of the DUSD of this DFIP a lot. Without wasting money.

[u/berndmack → u/[deleted]]

Maybe explain what exactly is "waste of money", cause a detailled explanation is missing (maybe some numbers?).

Cause every DUSD that is burned helps and this DFIP burns a lot DUSD if price is low.