[GRANT] Idle Perp Yield Tranche Convex strategy

Introduction

Idle is the longest-running and most-resilient DeFi yield aggregator and rebalancing protocol, which offers allocation strategies that allow users to maximize returns and optimize risk exposure across DeFi protocols.

Recently we released “Perpetual Yield Tranches” in beta version here, capped at $500k during the guarded launch. Tranches allow users to enjoy optimized DeFi yields with built-in protection on deposits by holding the Senior class, and leveraged yield exposure with Junior one:

  • Senior Tranche offers the safest way to access DeFi yields, thanks to its built-in protection feature. With this instrument, LPs can enjoy and participate in complex and exotic products, reducing the exposure to tail risks. Senior Tranches intrinsically have a first lien on the underlying assets — they’re first in line to be repaid in case of default (hack, loss of funds);
  • Junior Tranche receives an amplified yield by carrying a higher grade of risk, as Junior holders have a second lien or no lien at all in case of fund losses. This class of tranches is designed to receive a higher share of yield compared to the Senior class, which will proportionally compensate their Junior counterparts for taking such risks.

We launched the first $DAI tranches pool that tokenizes the risks & yields of idleDAI Best-Yield pool.

More info in our announcement: Introducing Perpetual Yield Tranches - Guarded Launch Phase #1

Grant Description

Integrate Convex as an additional yield source for Idle Perpetual Yield Tranches.

The strategy should allow an IdleCDO to deposit Curve LP tokens (eg steCRV) directly into Convex and stake them in their corresponding rewards contract.

The staked position in Convex should be tokenized (through the strategy itself or an auxiliary contract) so to be compatible with IdleCDO (which expects to have an underlying token, eg DAI, alongside an interest bearing token associated, eg cDAI). So users will deposits curve LP tokens in the IdleCDO and then those funds will get deposited + staked in Convex through the strategy. The tokenized position will then be sent to the IdleCDO contract which will be the final holder.

All Convex rewards + Curve rewards should be sold and the gain should be redeposited in Curve so to generate new Curve LP tokens that can be then deposited + staked in Convex (here is an example of similar code from Harvest Finance).

An example of a tranche strategy is available here (for depositing in Idle).

Technical documentation for Tranches is available here.

Grant Reward

500-2000 IDLE depending on completeness

Judging Criteria

  • Security approach
  • Gas efficiency
  • Development grade (only strategy code, unit tests, tests in fork)
  • Documentation completeness
  • Plus for deployment scripts

No KYC or personal info required.

Deadline: November 15th

Support

Devs can ask questions and receive support from Idle team by joining the dedicated Discord #Dev channel

Resources

8 Likes

Grant deadline has been extended to November 15th so to give more time to develop the integration.

The rewards for this is also increased and it’s now 500-2000 IDLE

All candidates should apply with a message here in this thread before starting

6 Likes

I would love to work on this! Started looking into the codebase and got some hints from the core team :slight_smile:

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Hi Team, I have a question. Say I would like to work on this task. But above me the good fellow Dantop has already “Taken it”. So would I simply not do this task and only wait until Dantop has submitted his first RP?

How does this work @william?

6 Likes

That’s a good question. In general, whenever possibile, I would encourage collaboration if
one it’s not too far ahead with the development. Sometimes tasks like this can be daunting
to be tackled by a single contributor so it could be productive to work with others.

Having some intermediate/weekly update on the state of the task would also help to understand
how things are moving and if another developer can help on this.

That being said we are preparing other grants related to Idle perp tranches (in addition to the 3 grants currently on going for the devs of the Gitcon 11 Hackathon, to continue with their developments) and Idle protocol in general so if a grant is already ‘taken’ and the contributor is doing a good job, I would
try to propose a similar grant, eg a grant for another strategy for perp tranches or something Convex related, if possible, in this case.

4 Likes

Okay, thank you. I’ll research some other yield sources. Any low-hanging fruits in general that the team has thought of?

2 Likes

We are still doing some research too on the complexity / feasibility of some integrations before publishing the RFP list but besides Convex and Lido which are both being developed atm by @dantop and @Bakuchii and Yearn which was already developed during the GR11 Hackathon (and for which we need to double check a few things) it would be cool to have integrations with Alphahomora, Liquity, Mstable, Harvest finance to name a few. Not sure if they can be considered low-hanging fruits though :slight_smile: @mrpqzm do you have some insights about any of those?

5 Likes

Hi William.

I get wanting to integrate with “Alphahomora, Liquity, Mstable”, however. Why also Harveset? From what I can see on the Harvest website. I already see IDLE as yield source. So what do you mean by wanting to integrate Harvest as well? Is there a different definition of “integration” here?

Best

2 Likes

There are 2 types of integrations, one could be ‘on-top’ (like Harvest or Yearn integrating idleTokens) or it could be and integration from our side as downstream lending provider (eg integrating Harvest finance as a yield source for tranches like in this case)

3 Likes

Heyo! Updates here.

The PR is open and was reviewed by the core team. The strategy is complete and supports all the LP tokens available on Convex :sunny:

The only thing missing is an integration test with IdleCDO, will commit that once I have it done (hope to have it veeery soon, like hours).

For reference: [WIP] NEW: Idle Perp Yield Tranche Convex strategy by dantop114 · Pull Request #14 · Idle-Labs/idle-tranches · GitHub

7 Likes

The Dev League finished the review of the Convex integration, the strategy has been sucessfully completed and the code is now merged! :rocket: :full_moon:
Big congrats to @dantop for the incredible work on this grant, it wasn’t easy but he managed to figure out everything without any issues so we decided to award him the full bounty amount of 2000 IDLE. :confetti_ball:

In addition to this the Idle community united added some bonus on top of this for a total of 500 additional IDLE:

+100 IDLE : https://twitter.com/curiosoacerca/status/1451892391611441154?s=20
+100 IDLE : https://twitter.com/ItsJustPureLuck/status/1451900145818214400?s=20
+100 IDLE : https://twitter.com/pan_teo_/status/1451904131807989762?s=20
+100 IDLE : https://twitter.com/coinballers/status/1451900796212158465?s=20
+100 IDLE : https://twitter.com/IdleHusbandry/status/1451958778031575043

we will collect the additional rewards and send everything in the next few days.

@dantop feel free to share an address here where we can send the rewards

9 Likes

It was real fun coding this! Looking forward to more integrations and strategies. And thank you to the Idle community! Will share my address in a discord DM.

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@unicorn @JonnyReid @Coinballers @Teo @mrpqzm please send the funds to the treasury league multisig here Proxy | 0xfb3bd022d5dacf95ee28a6b07825d4ff9c5b3814 , funds will then be forwarded to the address provided by @dantop (cc @Biaf )

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Amazing work @dantop
Absolutely fantastic.

Glad to have you on board! :slight_smile:

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Congrats @dantop on the great work. I’ve sent 400 Idle to the address @william provided as part of the bonus promised.

Hope to see more successful development work and great to have you as part of the dev community @dantop :muscle:

7 Likes

Hey @Coinballers It was 100 IDLE per member afaik, maybe it was not written in the best way :slight_smile: we will refund the 300 back to you. I’ll edit the message to make it more clear

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bro, you are supposed to send 100 $IDLE
lol

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It’s ok William. @dantop can accept it as a tip for the great work and incentive to build more on Idle. Cheers

9 Likes

done!
will send transaction via PM here on gov forum

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That’s awesome :tophat: :tophat: :rocket:

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