Proposal to integrate $ACRE as a borrowable asset on Venus Protocol and an ACRE/XVS liquidity pool to help bootstrap liquidity for Arable Protocol on Binance Smart Chain

Summary:

Proposal to have $ACRE as a borrowable asset on Venus Protocol and an ACRE/XVS liquidity pool to help bootstrap liquidity for Arable Protocol on Binance Smart Chain (BSC).

Purpose:

  • Establish a XVS/ACRE liquidity pool to bootstrap liquidity for Arable Protocol, increase the demand, and establish Arable on the BSC ecosystem.
  • Having $ACRE as a borrowable asset is beneficial for Venus Protocol by encouraging the current Arable users on Avalanche to bridge their $ACRE to the BSC and deposit their $ACRE on Venus Protocol, increasing the TVL of Venus Protocol.
  • Implement $VAI and $XVS as collateral assets to mint $arUSD when Arable Protocol launches on BSC.
  • Once $1,000,000 $arUSD has been minted, we would like to have $arUSD be a part of the Venus Protocol ecosystem by being a borrowable/collateral asset to increase liquidity for lenders and borrowers.

References/Useful links:

Linktree: https://linktr.ee/arable_protocol

Website: https://mvp.arable.finance

Litepaper: https://github.com/ArableProtocol/arableintro/blob/main/Arable_Litepaper.pdf-

Communities-
Twitter: https://twitter.com/ArableProtocol
Telegram: https://t.me/ArableProtocol
Discord: https://discord.gg/d8vHPxGfGx

Protocol Description:

Arable Proccol offers synthetic multi-chain trading and synthetic farming, a first in DeFi! Our objective is to make multi-chain farming accessible, affordable, and simple for everyone. Both seasoned and novice farmers can easily stake in yield farms from various chains thanks to a user interface that is straightforward but effective.

By the end of the year, Arable will launch its own chain as part of the Cosmos network to provide a platform for builders to develop a variety of DeFi products based on our ecosystem of synthetic tokens and utilize Evmos’ technological base to provide EVM compatibility.

We are actively marketing Arable Protocol and engaging with our community through multiple avenues:

  • We run numerous competitions, including our current “Arable Olympics” series of high-rewards events.
  • We host our own AMAs on our social channels and are guests at AMAs of our partners, such as Multichain.
  • We publish a variety of articles and educational content.
  • We collaborate with many partners across the DeFi space and micro-influencers.

Arable Protocol is based around a synthetic ecosystem and its liquidity is created through the minting of the stable asset $arUSD which is Arable’s native stablecoin which is pegged to the USD. Users can exchange between different LP tokens and synthetic cryptocurrencies using $arUSD, and they can farm on synthetic yield farms that follow the APR of their native chain counterparts.

Minters play an essential role in the Arable protocol. They act as the suppliers of synthetic liquidity to facilitate the trading and farming of synthetic assets (synths) at Arable. They create this liquidity by minting $arUSD and mint $arUSD by first depositing supported collateral assets on the Arable dApp. The USD value of the provided collateral is called Collateral Value. This value can change if the market value of the collateral changes.

More information on $arUSD is available at the following links:

Motivation:

The motivation for having an XVS/ACRE liquidity pool is to bootstrap liquidity for the Arable Protocol, increase the demand and establish Arable on the Binance ecosystem. Having $ACRE as a borrowable asset is beneficial for Venus Protocol by encouraging the current Arable users on Avalanche to bridge their $ACRE to the BNB Chain and deposit their $ACRE on Venus Protocol, increasing the TVL of Venus Protocol. This will also benefit users on BNB Chain who are looking to profit from farming on Arable’s current dApp on Avalanche before we build on BNB Chain.

There are many farming opportunities on different chains such as ORCA/SOL on Solana, MATIC/WETH on Polygon, VELO/OP on Optimism, and Arable users would farm arORCA/arSOL, arMATIC/arWETH, arVELO/arOP respectively. We are at a stage where we are focusing on building our own chain using Cosmos SDK where $ACRE will be spent as gas fees, making it faster and cheaper for users and validators alike. After that, we will build on other EVM compatible chains (and later also non-EVM) chains, which include BSC, and we will provide Arable’s DeFi products without having BSC users move to other chains to farm. This would increase the TVL on BNB Chain since they can farm on the Arable BNB Chain dApp.

Besides farming on Arable, users can also trade synthetic assets with zero slippage. So far, we have achieved over $5,000,000 in trading volume through our zero slippage DEX since launching trading in July. Users can also become minters on Arable, where they mint $arUSD and earn $ACRE APR and fees from farmers and traders.

$arUSD is used by farmers and traders as a base currency to buy different synthetic assets. We are planning for $VAI and $XVS to be implemented as collateral assets to mint $arUSD when Arable Protocol launches on BSC. Once $1,000,000 $arUSD has been minted, we would like to have $arUSD be a part of the Venus Protocol ecosystem by being a borrowable/collateral asset to increase liquidity for lenders and borrowers. The minting of $arUSD is over-collateralized, and over-collateralization helps protect the protocol against sudden price movements of the collateral assets.

Collateralization ratios:

USDT: 200%

FRAX: 200%

YUSD: 200%

AVAX: 300%

ACRE: 300%

Specifications of Arable Protocol:

Oracles:

  1. A select set of Arable Protocol validators run the following script to broadcast pricing data: https://github.com/ArableProtocol/arablevalidator/tree/main/oracle
  2. We are in talks with Chainlink to utilize their price feed.
  3. Our polling rate currently is every 12 minutes on average, we are working on getting this down to at least four by inviting more oracle nodes.

Audits:

Multiple audits by Solidity Finance: https://github.com/ArableProtocol/arable-contracts-official/tree/main/audits

Liquidations of $arUSD:

  1. Liquidations can be done by any user.
  2. A select number of permissioned validators provide oracle services for the protocol.
  3. The ownership is set to the deployer’s address for newly deployed contracts until contract parameters are finalized. The ownership will then be moved to multisig.

Market History of $arUSD: $arUSD has increased in the amount of collateral deposited since its launch in July 2022. arUSD has never de-pegged or come anywhere close to that kind of situation.

arUSD liquidity in July:

Curve pool for $arUSD on Avalanche: https://avax.curve.fi/factory/86/deposit

Exchange rate:

Exchange rate arUSD/USDC (including fees): 0.9963

Exchange rate arUSD/USDt (including fees): 0.9961