So long as we maintain DAI is a Protocol Reserve Assets, this is a fairly risk off place to keep it in the contract and recognize interest. $76M compounding at 1% is a non trivial number.

Ship it.

I can offer 1.33% APY, feel free to transfer funds to dr00.eth 😜

In all seriousness, happy to see us at least get some yield even if it's not much!

"It is proposed that a first deposit of 1M DAI is done to encourage potential exploit of the allocator contract." is one of the scariest lines i've read in an OIP…but yeah it seems like a good idea even still 🙂 General note that I don't think we should be making any riskier moves ahead of the (to be hired) new treasury manager starting, so they have a relatively clean slate - but this seems simple.

Any specific reason behind 77M but not 100M and why deposit 1M first and then 76M after that? Thanks

    Peter33

    The $77M is because we wanted to hold liquid reserves to refill RBS (And to be conservative we did a 2x Refill amount). Eventually RBS can talk directly to the DSR Allocator but this was a conservative approach. As for the 1M then 76M is was a risk hedge to test out the allocator with 1M, let it bake for two weeks and make sure it operates as intended and then move the rest of the liquidity.

    Just conservative moves.

      Probably it's not good to expose 1M just for testing.

        Peter33

        While I see your position, take the word 'testing' with a grain of salt. The amount we ever decide to put into a new contract always comes with risk but, what risk is acceptable has to be (and was) subjectively decided. We did an exercise on figuring out an acceptable hurdle rate compared to the missed income and the numbers passed the smell test. There's been more than 100M in the DSR Contract before our deposit as well.

        As a thought exercise, maybe think through how much and why you would start with knowing that ultimately you'll be depositing 77M and share your reasoning! =D

            Relwyn Isn't part of the reality that the amount needs to be big enough to attract hackers? Testing with $1000 won't lure anyone to check it out. Whereas$ 1M will make it worth probing, but not end-the-world if it does get hacked. Maybe we need to survey some hackers to see what their "get out of bed for" price is? 😉

                thomasscovell This is exactly it. How much is needed to create a race condition with potential exploiters?

                What is new is our allocator, which does not have any complicated logic, the base contract has been audited and the changes are minor. However, it is still a new deployment and considering how much reserves we propose to deposit I suggest safety first.

                A recent example is the Bond Protocol exploit, which was for ~$300k basically one day after the bond auction concluded.

                Also to you first comment. I agree that we should hand over a pretty clean slate to the new treasury team, but not at the expense of low hanging income.

                  2 months later
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