Direct USD+ integration

Dear 1inch community,

This is the proposal to integrate USD+ (yield generating stablecoin) directly into the 1inch aggregation protocol.

USD+ is ‘USDC that pays you yield via rebase’, i.e. a yield generating stablecoin yielding 7-12% APY, pegged to USDC, fully collaterized with low risk highly liquid DeFi yield-generating assets (overview here: The Auto-Rebasing, USDC-Backed Stablecoin (USD+) - YouTube)

USD+ can be instantly minted in exchange for 1 USDC and redeemed for 1 USDC instantly on demand. In the background, the smart-contracts of USD+ deposit/withdraw the received USDC into/from pre-determined yield-farming strategies when USD+ is minted/redeemed. The proposal is to integrate USD+ “mint” and “redeem” methods directly into 1inch.

Benefits of direct integration to 1inch, its users and community include:

  • better pricing and deeper liquidity: currently, most of USD+ liquidity is concentrated on Dystopia (new DEX on Polygon); despite relatively significant and fast growing pool sizes, the slippage on a 25000 USDC trade still exceeds 0,06%; direct integration would enable 0,00% slippage/cost on mint and 0,02% on redeem
  • product innovation: direct integration would allow to launch a new liquidity management products for 1inch audience, in particular, ‘overnight liquidity sweeps’, i.e. promote a solution allowing spare stablecoin liquidity parking to earn yield for short duration, as short as Overnight
  • usage of USD+ for 1inch DAO liquidity management purposes: in case the proposal to allocate a minor part of 1inch DAO treasury to USD+ passes, this would allow cheaper, more cost efficient access to USD+

Currently, USD+ can be minted/redeemed on dapp.overnight.fi for a fee of 0,04%, distributed among USD+ holders. Should this proposal pass, the fee for mint/redeem of USD+ would be reduced for 1inch and its users: 0,00% on mint and 0,02% on redeem. The small redemption fee will be kept as protection from MEV, i.e. mint/redeem of a large amount of USD+ prior to/after the daily payout.

Thank you for consideration of this proposal. There is a planned community call where we intend to present USD+. we look to answer your questions here in writing and further questions in person during the community call

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