Proposed new PowerVault: $LUCY

$LUCY is a proposed new stablecoin-based, multi-source yield optimisation PowerVault that automatically harvests yield from multiple sources on the Liquity over-collaterised ETH $LUSD stablecoin, including ‘defensive’ collateral liquidation premia, more frequent in ‘down’ markets when ETH prices can fall quickly. The $LUCY PowerVault fully utilises the Balancer v2 custom pool architecture, Aave lending pools, Liquity internal yield options and liquidation services from B.Protocol, all under the control of the new Power Agent v2 decentralised automation network. Liquidations yield rises when ETH prices fall, usually in down markets, meaning that $LUCY yields can rise in down markets.

$LUSD TVL is growing rapidly in the wake of problems with USD fiat-backed stablecoin USDC, and pure ETH-based investors/savers will be looking for ‘defensive’ yield options that benefit when ETH prices drop suddenly.

Based on PowerPool Research/Labs simulations and backtesting of the StableSwap model with an arbitrage agent modeled on on-chain data, $LUCY can offer ~15% yield without additional rewards, i.e. this yield is generated without “token printing”-style liquidity incentives. Additionally, the yield doesn’t require the liquidity provider to hold/lock other assets (besides $LUSD) in advance to generate the yield. In summary, $LUCY is canonical structured ETH DeFi, providing ‘defensive, multi-source yield on ETH-based over-collateralised stablecoin like $LUSD.

We plan to launch $LUCY ($LUSD+a-bb-USD Balancer v2 pool) as soon as possible with a collaborative multi-protocol approach to awareness and marketing. $LUCY in launch form is a Balancer Boosted pool built on top of bb-a-USD and involving LUSD. It’s a stablecoin pool that pairs $LUSD with a three-pool of USDC/DAI/USDT, similar to the LUSD-3CRV pool on Curve. The main difference is that the stablecoins in the pool also harness additional yield sources leading to enhanced native yields for liquidity providers.

This is a very short synopsis of $LUCY. 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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1 Like

This will be a great product!!!

Proposal looks good and convenient, but want to ask something, these are the major stablecoins.
Since the algorithm and code base is going to be ready, will be there any differentiated products for LUCY with other algorithmic stablecoins with little bit higher risks ?

Back to LUCY, it is a good opportunity for retail users can hedge their risks during bad shaped market times. I am positive about this product. Well done.

Hi, in the recent depeg and peg showcases, I watch USDC and DAI which is backed by USDC melted and re-peg. But what if some day, there will be a bigger fud on these stables, and I think there will be, what will be the outcome and damage, and what is the research team’s potential cautions and ideas on these.

Product is good, no fud on it. But market is working strangely sometimes and externals hitting a lot to stablecoins.

What do you think about it ?

LUSD has been the biggest gainer in TVL as people realise that immutable, over-collaterised ETH-only is the way to go for canonical stablecoins. The problems with USDC and reluctance to fully embrace/trust Tether/USDT have driven more TVL to LUSD than any other stablecoin.


There is a team forking Liquity into a new version that works with LSTs, rather than unstaked ETH, as collateral. Perhaps someday we will be able to mint LUSD directly from very high yielding $LSTETH collateral. This is the way…

Great Proposal, can not wait to see what happens after it deployed!

congratz team

Thank you for clarification!

Got it. So there is no such concern like that.