Inspired by Yearn Safe Farming Committee, this post aims to set the minimum standard requirements needed to implement a new yield source or an asset in Idle protocol.
The standards reported in this guideline will have the goal of helping the Idle community, builders, protocol founders, and Idle liquidity providers to perform adequate due diligence on the current and future yield generating integrations and infrastructures.
One of the unique benefits of DeFi is the interoperability and composability among the many different protocols and applications.
Having multiple assets and protocols integrated with the Idle ecosystem is a continuous goal for our protocol, and we gladly had many other projects and founders reaching out to integrate their products into Idle strategies.
Yet, Idle is based on battle-tested protocols, but at the same time new opportunities might arise and we should define an impartial set of directions and standards to evaluate new possible yield improvements.
This guideline would represent an onboarding process for new partners that want to get integrated into Idle, and current/prospective liquidity providers would get a clear overview of the Idle vision on protocol infrastructural changes. Furthermore, builders who would like to work on new implementations via Grants Program Framework would be guided in proposing ideas aligned with protocol goals.
Goal: when a new integration proposal comes up in the Idle forum, the proposer should respect the safety criteria down below.
This due diligence process could drive the community on many decisions: integration into Idle, grant matching/request, liquidity incentives, coverage proposals, and whatever puts Idle brand&funds at risk.
Mandatory safety criteria:
|Audit and due diligence||Has a reputable company audited contracts, or are they fork of audited projects?||1 custom audit|
|Months of activities since first contract deployment||6 months|
|Months of activities since last contract update||3 months|
|Are contracts immutable or upgradeable by admins? If upgradable, how many admins control the keys, and are they anonymous?||Immutable preferred, but evaluated case by case|
|Is there an emergency exit plan?||Evaluated case by case|
|Are there protocol dependences?||Evaluated case by case|
|Has the protocol/asset suffered losses in the past?||Evaluated case by case|
|Performances||Current protocol TVL or asset circulating supply||$ 50M+|
|Expected TVL/supply in 3 months||$ 100M+|
|Current protocol’s or supported services’ APYs||+30% than Idle 30-day strategy average|
|Would Idle asset liquidity affect APYs?||Less than 10%|
At the time of writing, Governance can use this framework to evaluate new market opportunities. In the future, the security assessment could become one of the tasks assigned to a possible Yield League.
We aim to improve and update this guideline along with Defi market growth and evolution.
If our community has any suggestion for more metrics to add to the table as indicators of good/bad protocol&asset health, we’re looking forward to hearing your thoughts!