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Pickle Protocols
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InstaDapp INST/ETH Strategy #76

Open icecreamman8 opened 3 years ago

icecreamman8 commented 3 years ago

Intro

InstaDApp is a smart wallet with an intuitive interface built on top of popular DeFi projects like MakerDAO, Compound, Uniswap, etc. for managing assets. It’s optimized for users lacking advanced technical or financial experience.

InstaDApp was release very recently, and has quickly climbed to #3 on defi pulse with $8B in TVL.

The INST token is their native governance token. The liquidity for INST is on uni v3, in an INST/ETH pair.

Strategy

  1. User deposits ETH and INST on Pickle
  2. Pickle takes the ETH and INST and deposits it in the InstaDApp protocol, which puts it in the automatically managed INST/ETH v3 LP.
  3. Rewards are paid out once a week by InstaDApp. Pickle harvests rewards.
  4. Pickle sells half of INST rewards for ETH, deposits into InstaDApp again.

APY and target TVL

INST reward APR (paid out weekly) is currently 334%. With Pickle’s 20% performance fee and a Strategist fee of 7.5%, the base APR after accounting for fees is:

334*(1-0.275) = 242% Base APR

Compounded weekly, the APY comes out to 964%

The TVL of the INST/ETH pool is $9m. This is expected to grow, as InstaDApp has only launched recently. With a good marketing push, this jar can target to have a TVL of $1-2m.

Looking forward to hear what you guys think!

larrythecucumber321 commented 3 years ago

Thanks again for the great idea @icecreamman8! InstaDapp has certainly been growing at a very impressive rate - I've personally farmed INST/ETH myself.

The APRs and TVL look quite good for the INST/ETH pair. However, the weekly claiming is a big issue which we don't currently have a solution to yet, and so I think that a jar for this is unfortunately infeasible. Per our current contract structure, a user depositing on Day 1 would receive the same rewards as a user depositing on Day 7, meaning that it's massively susceptible to sandwich attacks. This is also the reason we haven't created Jars for Balancer or BarnBridge, for example.

I also wanted to clarify that the strategist fee would be available only where significant changes to the strategy contracts were made. For example, adapting the ALCX/ETH strategy to farm another pool2 pair would not constitute a large enough change to warrant the fee. However, if you were to find a solution to the weekly epochs of Instadapp, that would certainly be enough!

hkfvdk commented 3 years ago

Maybe a time window could work wherein people could deposit, and they can't deposit outside of that window, but could queue their deposits outside of it.

This would need a pretty big disclaimer but might be an alright bandaid fix while something more sophisticated would eventually replace it.

manymoneymanny commented 2 years ago

This would need a pretty big disclaimer but might be an alright bandaid fix while something more sophisticated would eventually replace it.

@icecreamman8 @hkfvdk If people cannot economically attack the jar by getting rewards they're not entitled to, that is enough to satisfy the requirements. As long as there are no UI bandaid fixes, that would do.