Potential Composability
Non-exhaustive list of composability options for Membrane contracts & CDT
Last updated
Non-exhaustive list of composability options for Membrane contracts & CDT
Last updated
CDT provides LPs with a stable pair asset and predictable minimums for ownership of total volume due to the liquidity multiplier capping supply.
A stable asset adds stableswap LPs which provide DEXs with substantial reoccuring volume as traders arbitrage differences in system design on top of the usual dose of DEX arb opportunities.
CDT is additionally valuable on chains with deployed minting contracts as it acts as a collateral aggregator for market makers, which benefits overall trade execution.
The Positions contract can be used to mint CDT for , leveraged yield, liquidation bids and leveraged trading (loops made easy with the Margin Proxy). It's also ripe for any type of management which includes LTV protections, interest rate arbitrage & CDT arbitrage. The Discount Vault is a lego for yield strategies using open loans as it provides accepted LPs with interest rate discounts that increase profit margins.
The liquidation pools, Liquidation Queue & Stability Pool, can benefit from management that automatically handles rewards (sell, compound, stake) & acts as an option during liquidation periods for profit opportunities.
Notes:
For most strategies vaults only need to control the CDT.
Margin Proxy has example looping functionalities for any leverage strategies.
The best collateral are low-volatility & high volume. The system incentivizes low-volatility around the peg which attracts the market for stable assets to utilize CDT. From there, its collateral grade only improves over time as stable assets monopolize volume in DEXs.
