Launch vETH Loop Stake

Content

AI Summary

Following the approval of Referendum #205, the community agreed on a framework to redeploy excess ETH reserves to enhance protocol efficiency and user yields.

Given the current market environment marked by lower liquidity and increased volatility, 35% of excess reserves will be converted into USDT and deployed into RWA-backed stable yield strategies to generate sustainable treasury income.

We propose a modest adjustment to the previously discussed allocation ratios to strengthen treasury stability.

Updated allocation plan:

15% allocated to vETH Loop Stake

This proposal concerns the 15% allocation dedicated to supporting vETH Loop Stake lending liquidity.

The adjustment maintains support for capital-efficient staking strategies while improving the protocol’s defensive positioning in a more uncertain market cycle.

Implementation Plan

Withdraw 15% of the exceeding ETH reserves from the Bifrost Treasury
Adding ETH to launch vETH Loop Stake

Expected Impact

Increase borrowing depth within the vETH Loop Stake pool
Support larger-scale loop staking participation
Improve capital efficiency for vETH holders
Diversify the DeFi strategy for vETH

By expanding lending liquidity, users can leverage their vETH positions more efficiently, enhancing staking APY through structured loop strategies while maintaining on-chain flexibility.

Edited

The community voted to use extra ETH reserves to help the protocol work better and give users more rewards.
35% of the extra ETH will be turned into USDT and used in safe strategies to earn money for the treasury.
15% of the extra ETH will go to vETH Loop Stake to help with lending.
This plan keeps support for staking while making the protocol safer in uncertain markets.
The ETH will be taken from the treasury and added to vETH Loop Stake.
This will allow more borrowing, support bigger staking, make vETH use more efficient, and add variety to strategies.
Users can then use their vETH better to earn higher rewards through staking.