It’s been a busy month for us at C.R.E.A.M.: last week we announced the launch of the Iron Bank, a protocol-to-protocol lending platform and liquidity backstop for the entire DeFi market. The Iron Bank is poised to provide liquidity to new Yearn vault strategies as well as Alpha Homora v2.
But you know who we are — we can’t stop won’t stop. We know how important it is to the C.R.E.A.M. community that we continue to innovate.
That’s why today we’re announcing the addition of SushiSwap and Uniswap LP tokens as collateral for borrowing and lending on C.R.E.A.M.
As Dan Elitzer explained in this post on superfluid collateral –
“If assets can be allocated for multiple purposes simultaneously, we should see more liquidity, lower cost of borrowing, and more effective allocation of capital.”
The way we see it, there is no reason for LP positions to sit idle in yield farmers’ wallets. This is capital inefficiency at its worst. LP positions are valuable collateral. As collateral they will be used to generate further liquidity and earnings for both the original farmer and other market participants.
Providing liquidity in DeFi is a valuable service — it’s akin to running a small (and sometimes not so small) business. Providing liquidity generates real cash flows and in traditional financial markets, cash flow generating businesses can be leveraged. Business owners borrow against their current assets and future cash flows to grow. C.R.E.A.M. wants to empower this growth for the entire DeFi market.
Today, C.R.E.A.M. users will be able to supply and borrow the following Uniswap LP positions:
WBTC-ETH
ETH-USDT
USDC-ETH
DAI-ETH
Next week, C.R.E.A.M. will become the first DeFi money market to list Sushiswap LP positions as collateral. Additionally, supplied SLP will be routed back to SushiSwap to earn SUSHI. We will list the following SLP assets:
WBTC-ETH
DAI-ETH
USDC-ETH
ETH-USDT
SUSHI-ETH
YFI-ETH
CREAM will optimize supplied (and unborrowed) SLPs — the deposit contract will:
- Automatically stake SLPs into Sushi’s masterchef contract
- Claim SUSHI rewards
- Redeposit SUSHI rewards into xSUSHI
When depositors withdraw their SLP, they will also receive unlocked xSUSHI rewards that they earned on their deposited SLP. Please note that SUSHI earnings will vary based on utilization rate, as borrowed SLPs leave our platform and cannot earn SUSHI rewards.
Collateral Factor (LTV) for LP tokens will range from 50%-75%, starting January 31st when this proposal passes.
As always, thank you to our community and partners for continuing to support our efforts to expand and innovate in the DeFi landscape. If you want to get involved, you can join us on Discord, follow us on Twitter, or visit us at cream.finance.
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