New listing: GOLD and SILVER

Summary

This publication provides an overview of the decision to list GOLD and SILVER (Meld Gold & Meld Silver) on Folks Finance.

Abstract

GOLD is a digital asset that is backed by 1g of fine gold held in the Meld ecosystem. Gold can be redeemed and digitised with any participating dealer that makes up the ever expanding network.

SILVER is a digital asset that is backed by 1g of fine silver held in the Meld ecosystem. Silver can be redeemed and digitised with any participating dealer that makes up the ever expanding network.

Meld Website: Meld Gold | Token

Motivation

The introduction of GOLD and SILVER to Folks Finance underscores several strategic angles:

  • Capital Influx: The inclusion of GOLD and SILVER will bring external liquidity to the Folks Finance protocol. This could significantly increase the Total Value Locked (TVL) in the Folks Finance protocol.

  • Asset Diversification: Adding GOLD and SILVER enhances the diversity of assets available on Folks Finance. Users will be afforded greater flexibility in their choices, from a simple holding to more intricate strategies, potentially intertwining GOLD and SILVER with other assets in the Folks Finance ecosystem. Liquidity providers could unlock novel opportunities and products by leveraging GOLD and SILVER. The community also expressed a great interest in having GOLD and SILVER in the lending market, given the growing interest in the RWA market

  • RWA approach: At Folks Finance, we believe the RWA market will be a major player in the next cycle and this demonstrates our initial approach to it. This listing could lead to attracting key LP investors to the Folks Finance ecosystem.

NOTE: Lending pools GOLD/ALGO and SILVER/ALGO will be created. Farming rewards will be allocated on top of them.

Specification

Ticker: GOLD (MELD GOLD)
ASA ID: 246516580

Parameter Value
Collateral Factor 60%
Borrow Factor 100%
Liquidation Max 50%
Liquidation Bonus 8%
Liquidation Fee 10%
Collateral Cap ($) 70.000
Variable Base Rate (RV0) 1.75%
Variable Slope 1 Rate (RV1) 5%
Variable Slope 2 Rate (RV2) 100%
Stable Additional Base Rate (RS0) 2%
Stable Slope 1 Rate (RS1) 2%
Stable Slope 2 Rate (RS2) 100%
Stable Excess Rate (RS3) 25%
Optimal Utilisation Ratio (Uopt) 60%
Optimal Stable to Total Debt Ratio (Oratio) 20%
Rebalance Up Utilisation Ratio (URU) 90%
Rebalance Up Deposit Interest Rate Percentage (DIRRU) 55%
Rebalance Down Delta (RD) 20%
Retention Rate (RR) 10%
Flash Loan Fee 0.1%
Borrow Cap ($) 70.000
Single Stable Borrow Percentage Cap 6.2%

Specification

Ticker: SILVER (MELD SILVER)
ASA ID: 246519683

Parameter Value
Collateral Factor 60%
Borrow Factor 100%
Liquidation Max 50%
Liquidation Bonus 8%
Liquidation Fee 10%
Collateral Cap ($) 70.000
Variable Base Rate (RV0) 1.75%
Variable Slope 1 Rate (RV1) 5%
Variable Slope 2 Rate (RV2) 100%
Stable Additional Base Rate (RS0) 2%
Stable Slope 1 Rate (RS1) 2%
Stable Slope 2 Rate (RS2) 100%
Stable Excess Rate (RS3) 25%
Optimal Utilisation Ratio (Uopt) 60%
Optimal Stable to Total Debt Ratio (Oratio) 20%
Rebalance Up Utilisation Ratio (URU) 90%
Rebalance Up Deposit Interest Rate Percentage (DIRRU) 55%
Rebalance Down Delta (RD) 20%
Retention Rate (RR) 10%
Flash Loan Fee 0.1%
Borrow Cap ($) 70.000
Single Stable Borrow Percentage Cap 6.2%
2 Likes

any news about their market makers or will the peg on chain fully rely on them arbitraging it and therefore ensuring liquidations can happen?

There is a market maker which has committed to keep token price within 1% at a maximum 24-hour volume which we aren’t close to hitting anytime soon. Otherwise as GOLD and SILVER gains more adoption in the ecoystem and people’s confidence increases, it is possible others will do their own market making.

2 Likes

you think keeping the liquidation incentive at 8% which seems to be standard is ok if we rely so heavily on that “commitment”? seems pretty risky to me since all I see is people talking about how they are trading SILVER here on Algorand and how its again under peg

My understanding was that the was an issue with the market making on SILVER but it was resolved on Monday and shouldn’t happen again

2 Likes

How do I buy GOLD$ and SILVER$, i.e., outside of a DEX?

The only way to bring external liquidity to Folks Finance is to be able to acquire the assets externally.

what oracle prices will be used? folksfeed doesnt have GOLD/SILVER listed yet

You can checkout their website https://meld.gold/

They will be added to Folks Feed before listing

1 Like