An $LSTETH 10+ LST diversified basket to spread LST contract/multi-sig risk broadly w/auto harvesting of arbitrage gains & farming of extrinsic yields. Floating weights but max caps to protect decentralisation of LSTs/Validators. Basket NAV to include a liquid ETH Safety Fund to re-insure uncovered incidents of LST slashing, and smooth investor mints & redemption queues in conjunction with LST basket arbitrage operations. Fee stream (0.5%?) to be divided between PowerAgent Task fees (~0.2%), and the PowerPool Treasury (~0.3%). DAO will maintain white/gray/black lists periodically classifying 25+ candidate planned ETH LSTs and set basket max caps and manage Safety Fund size allocation parameters.
Post Shanghai, ETH staking & LST TVL will grow explosively…this $LSTETH PowerBasket is potentially easily a $100+ million TVL product.
After $LSTETH, PowerPool should eventually deploy many similar diversified LST baskets along with PowerAgent automated arbitrage, rebalancing and harvesting of extrinsic yield on many EVM POS chains. This ensures baseload tasks/fees to incent more nodes on each chain. Someday PowerPool could also launch a ‘blended’ pool-of-pool ‘flagship’ basket token like $PWRPOOL representing an actively-managed, diversified mix of L1 & L2 EVM POS LST baskets, with the $PWRPOOL basket of baskets regularly re-balanced by TVL…providing a very broadly diversified, multi POS chain LST real yield token that will be attractive to a wide range of institutions and small retail savers.
Example Twitter blurb:
Baskets with 10+ LSTs spread contract/multi-sig risk
Basket Safety Fund instantly tops-up any LST slashing coverage
2 sources of LST mint/redeem peg arbitrage benefit basket NAV/yield
Auto optimises extrinsic yield (& gas) on underlying LSTs
Better collateral than any one LST
#lsteth
Risk/Return Marketing Claims: (vs investing in a single LST)
Higher Yield:
Block reward exposure
Arbitrage gains in NAV (Safety Fund)
Average LSP fee compression-(<10%?)
Gas costs
+(cross staking - Eigenlayer?)
Lower Risk:
Near-instant match/withdrawal
Spreads (insured?) contract risk
(Re-)insured, reduced slashing risk (DVT)
Competitive Positioning
Passively-managed LST ‘indexes’ can spread smart contract risk on underlying tokens, but w/o offsetting their wrapper risk/fees. However, actively-managed, automated, 10+ LST PowerBaskets like $LSTETH add continuous peg arbitrage yield and optimised, automated, gas-efficient farming of underlying LSTs w/near-instant (ZAP-optimised) ETH mints/redemptions. → Higher yield and lower risk on ETH passive income compared with picking just 1 (out of ~25) LSTs and farming it yourself.
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This is a very short synopsis of $LSTETH. For a much more detailed overview of the opportunity and go-to-market planning, and how all DAO members can contribute, please see the Project Wiki:
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