#14 Provide 100k $BADGER Liquidity on Euler

TLDR: Deposit 100k $BADGER onto the Euler platform in order to facilitate loans.

Background

With money markets such as C.R.E.A.M. and Rari not being fully operational anymore, $BADGER needs other possibilities for lending and/or borrowing. Euler is a permissionless money market and offers the DAO that opportunity.

Proposal

Deposit 100k $BADGER into the already created $BADGER market on Euler (https://app.euler.finance/market/0x3472a5a71965499acd81997a54bba8d852c6e53d). The oracle has been updated to the existing $BADGER Chainlink feed. All that is missing is liquidity.

Metrics of Success

How long will the investment thesis take to play out?

Reevaluation of offering this liquidity could take place every quarter.

Will the treasury recoup funds or does the investment represent an outlay?

If considered unnecessary the treasury could withdraw all liquidity, as long as the utilisation rate allows for this. At no point could the funds be lost; they will just be stuck in a loan.

What are the risks associated with each investment?

  • Protocol risk (0 - 10): Likelihood of a smart contract or a system of smart contracts (protocol) is exploited or funds are lost

5: Our own audit of Euler’s systems showed the biggest vulnerability is the fact that their 3/7 multisig could perform a malicious upgrade.

  • Credit risk (0 - 10): The risk of loss from the failure of a counterparty to make a promised payment, this should cover airdrops expected.

3: As said, there is a risk that the full amount cannot be recovered until the counterparty closes their loan. We would still be earning a supply interest rate on it though.

  • Execution risk (0-10): How long will it take to execute, how many signers on a Multisig or queue of things that must be signed first.

3: Deposit and withdrawal actions are pretty straightforward; we are not looking at taking out loans or leveraging or any other more complicated actions on Euler yet.