SUGGESTION: CRV/Convex Frxeth Strategy

Proposal to start discussion on adding ETH/frxETH pool on Curve&Convex as a Gearbox Strategy

The growth in ETH LSD’s have fuelled many protocols usage and TVL past few months. stETH CRV/Convex strategy had been one of the community favs for leverage ninjas. In that momentum an underutilised ETH LSD had been FRXETH and the Curve+Convex pool & its sustained yield. This new topic seeks to gather feedbacks& thoughts on adding Eth-frxETH Curve pool & Convex Pool to usable strategies of Gearbox & capitulate on the growth & momentum of ETH LSD’s.

eth/frxeth pool had been consistently growing in size & keeping a very strong healthy peg with eth.

All the while keeping a sustained incentive for pool stakers. utilising Frax’s strong presence in vote markets and crv/cvx ecosystem they scaled their 10% consistent yield together with TVL. Graph of emissions directed to eth-frxeth pool in the same time frame below

And for longer term, frax is considering making a frxethbp (like the evolution of frax-usdc pool) and incentivise it even further while scaling with TVL, volume & new pairs.
[Frax] [FIP - 182] frxETHBP & WETHR Program

For past few months eth/frxeth pool had been yielding consistent 10% with CVX/CRV/FXS rewards. And given the above info, safe to assume the liquidity and incentives will be stably increasing for this strategy to be continously viable.

It is by far the juiciest ETH Staking/LSD strategy out there right now. Even comparing with wsteth/eth pool on balancer, it has no IL while yielding virtually the same. I think it would be a net positive for Gearbox to further leverage the momentum of ETH LSDs & provide a great offer for yield seeking ninjas by integrating this strategy.

With this PRE-GIP topic, seeking for opinions, questions, considerations, love letters for onboarding FRXETH Curve/CVX Strategy on Gearbox. Looking forward to to incorporating all comments into a more structured and better informed future GIP in case there is appetite for it.

Data sources: & frax governance

One critical comment i was made aware is that it is not possible to add it due to lack of a Chainlink oracle for frxETH

Below update from Sam Kazemian on that front (25th of Jan )
frxETH Chainlink Oracle

1 Like

I believe (not a dev though) that curve oracles could at some point be used (to go for more factory pools where Chainlink might not have reach) but that requires a bit more understanding / research / work - and needs to be done before accepting collaterals without a Chainlink oracle.

Otherwise, the proposal is totally sexy and sound, thank you @simurgh!

1 Like

[pre-GIP] Add cbETH to Allowed List - was noted in here at the bottom.

1 Like

Thx! Following that topic as well. From frax tg info, seems it will be ready within the next 2-3 weeks. I’m keeping chasing it on that side as well and can confirm work is progressing on it.

Given this is a caveat we can account for, should we continue to move it further down the DAO processes to be prepared when Frax team delivers it? Mentioning specificly that action on this topic will be pending Chainlink Oracle delivery.

Just think the due process & preparation part can happen while frax team is working on it and we can be the first to market with a FrxETH strategy (since literally everyone is waiting for that oracle)

as soon as we have oracle, I guess we can start voting… @yaron do you have some estimations for LT for frxEth (if there is CL oracle)

0.9 vs ETH. assuming the current market conditions won’t change by then.

1 Like