Silo Post v2 plans

Hi all, I have been avid user and accumulator of SILO in last year. I saw the protocol constantly grow and improve, while at the same time it followed Defi norms and standards.

I do believe that after v2 we should concentrate on couple of improvements that could be built around and on top of the protocol that will help onboard massive TVL and give us more user growth.

1. Allow for permisionless creation of SILO

This one is very simple and I feel is dully missed. On Arbitrum we saw great number of protocols offering simple leverage of GLP and racking up massive revenues.
Best innovation that Silo provides is the risk management of single Silo. This means we are best positioned to offer lending of obscure exotic tokens.

I strongly believe that the process for creating new Silo, and adding it to Front-end should be permission-less and straightforward. Just provide indication of asset, oracle, liquidity and whatever else is needed.

In order to protect Defi newbies we could provide an alert messages on Silos indicating possible risks (Similar to what we have now for Umami).

2. Create leverage shortcuts

Even simpler, if you onboard tail-assets you often want to leverage on it. Just provide interface for it (similar to what Abracadabra did at the time).

3. Give out grants for SILO yield vaults

There are good yields to be earned by shifting through different Silos. This could be automated or even done through managed vaults. Think the best way to do it is to offer Silo grants to teams that manage to pull certain TVL through their vaults for Silo.

4. Avoid traditional emissions and try Options mining or Vested tokens

I’m big opponent of emissions for attracting TVL as I have seen that movie in Defi hundred of times. Liquidity never sticks, capital is mercenary.

If we want to opt for emissions as a marketing push for v2, I implore everyone that we use more protocol friendly variants like Options emissions (Timeless, Tapioca, Dopex) or Vested tokens (esGMX).

Thank you for the great post, and for being an avid supporter of the project.

V2 is in the making, and introduces major features that will propel our growth. We plan to publish a whitepaper and contracts around the time we are closer to launching on test net, similar to the fashion Uniswap V4 has been introduced.

To your points:

1-The permissionless creation of markets is a great feature to have. However, the reason you don’t see leverage lending markets such as jUSDC, to mention one, is that you still need to develop a custom oracle and a custom liquidation logic to handle undercollateralized situations. As opposed to vanilla lending markets, say OHM, where you have a plug&play oracle (Chainlink feed) and liquidation support (because it is easy to sell OHM into an AMM pool), a jUSDC market (created permissionessly or not) needs a solid logic around reading the price of the derivative securely (oracle manipulation problem) and a custom redemption mechanism where jUSDC can be redeemed without any obstacles for the underlying at the correct price.

2- Silo V2 enables leverage, meaning our UI will support it, and external dApps plugging into our contracts can use the feature too.

3- veSILO handles the distribution of SILO rewards. Vaults behave like any depositor and will farm SILO and claim it too. veSILO can reward users with any ERC-20 token. It is up to the community to decide whether to use liquid SILO or a SILO-bond that can be redeemed at maturity.


Thanks for your answer

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