Paying 3 separate entities to buy and burn 1usdc from exchanges, and not mentioning any of the other assets that make up 60% of the lost value.
This incredible plan is very well worth the almost half a year wait. The amount of brainpower that must have gone into this is inconceivable. I am in awe and draw my hats before the masterminds that came up with this.
I’m very thankful to potentially recover a fraction of my lost funds some years or decades in the future. I feel blessed to witness this historic recovery, you will forever have my undying gratitude.
If I had to guess , I would say that the intention is to repeg USDC and liquidate it into USDS. And open up borrowing and lending on USDS for Tranq. Not a bad gameplan,
Congrats R1. You guys got Harmony to take action. Now that the recovery & reimbursement is live the core team can get back to building value for the chain & ecosystem.
I really like that action is being put in place and that we have a path forward is there a plan with R1 host an AMA or Townhall to explain in a more simple and definitive way how this process will look. I love the idea that stably will be utiilzed , But what about Devs and building and funding? Maybe providing an update with to Community should be consdiered via Townhall / ama.
With Round 2 would you consider some sort of methodology for increasing the redepmtion rate based on demand? Even if it is manual that would be better than the current.
With the existing model it creates an environment which benefits arbitrage and expends USDS at a higher rate than may be dictated by market, at least until fair market rate matches exchange. Whilst the market is below redemption rate there’s significant arbitrage opportunities above minimum and once the market rises above the rate, we would expect exchanges to drop significantly. Modulo’s implementation is pretty good for this, but the current cap on Modulo will see the same issues.
Cman, Thank you for your feedback. Please keep the great ideas coming we welcome all ideas and collaborative efforts!
The recovery plan and its partners are creating a vector toward the target of 100% participation and reimbursement over 4 years.
Dynamics in play:
Modulo’s mechanism which includes min and max created the ceiling (.10cents) as well as an average price of around $.082 - .085 cents, the mean price.
The Recovery Exchange set the floor, as we watched the market settle in at .07. R1 also affirmed Modulo’s ceiling at .10cents.
Tranquil- they are draining the liquidy from their pools at a market price .88 -.89cents.
“Depegging Node” - has and will continue purchasing 1USDC and burning at market price as well .82 -.89cents.
The market (where buyers and sellers, gather to facilitate exchanges) will see this cumulative vector and this will be the road to recovery for depegged 1asset holders.
We will be making slight adjustments to our Recovery Exchange in time. Once again we welcome your feedback and suggestions.
Thank you for your response. I understand what you are saying with regards to the different participants contributing to the market dynamics.
If we look at both Modulo and yourself and the on-chain USDS exchange rate in real $ as traded against WONE - with the current USDS exchange at ~$0.90 and the cap at 0.10 - we see that with the current market rate at $0.09 that it is no longer profitable for automatic arbitrageurs pending movements in USDS exchange or a significant influx of USDC into the LP’s. I can see that Modulo is hitting cap and sitting there for hours on end, whereas this was not happening a few days ago.
I know you can only speak for R1, but are there any metrics that you would consider using for when to increase the exchange rate? I understand that in the interests of efficiency and with the 4 year timeline you could in theory keep it at 0.10, however Tranquil will continue to purchase into the LP’s and thus I’d expect the participation in both Modulo and R1 to trend towards 0 - which I expect may change your performance in the KPI’s towards future funding rounds from Harmony.
Do you intend to continue doing the multiple exchange rate tiers?
This initial round rewards those who voted with rONE with a higher rate. I would be cool continuing that if R1 so chooses. I would also be in favor of either allowing more holders/wallets into that higher tier or creating a new tier altogether. For example, there could be a premium rONE voter tier, a previous R1 exchange user tier, and the intro tier for first-time R1 exchangers.
My thinking is to reward users who participated in the exchange, similar to rewarding users who participated in the rONE vote. And by rewarding participating with a slightly higher exchange rate, it could encourage more holders to start participating, and even allow already-participating holders to continue exchanging by using new wallets.
The more burn the better.
I’m sure R1 has their own ideas on incentives and tiers, but the main point is that there needs to be a reason for holders to exchange their 1USDC at a marginal exchange rate. Because currently, I don’t think many non-rONE voters will exchange for .07 when 1USDC is going for .0995 on DEXes. Even the higher rate for rONE voters isn’t much better than what can be earned on-DEX. Although, hopefully the rising price of 1USDC can be concluded to the result of successful early recovery efforts (burning > 600k 1USDC already).
cman - great ideas and more is coming to R1. The first round sets the path for recovery. This will be a 4-year journey and it will work in the background as Harmony grows its tech and ecosystem.
Matthew- tranquil has signaled they are working towards restarting borrowing and lending.
unarge4, i stated previously Harmony and Aave need to work this one out.
trick- yes, we wanted to affirm the ceiling and set the floor in round 1. We will be releasing more in time. Once again this is a 4-year journey targeting 100% participation and reimbursement.
Now that the recovery of 1assets is underway I would expect to hear some additional stories and narratives from Harmony about new partners, tech, users, and the growth of the ecosystem.
Rest assured the recovery partners, and R1 are here working on our mandate (visit R1 @ R1.fuzz.fi). We will continue to be focused and resolute for the community. This recovery process and its partners are helping to restore trust in the ecosystem. Yes, the first part is a successful early launch of the recovery plan. That is now underway!
