How could EEFI’s value not be diluted if AMPL is most of the time in equilibrium?
The goal is to provide an avenue for yield (the generation of some expected return on investment) during negative rebases and equilibrium, which currently does not exist. Depositing AMPL on Aave does not save anyone during negative rebases. Selling remains the best option and contributes to sustained negative contractions.
We are not worried about EEFI’s value nor its dilution. How it accrues value is for the community, and broadly the market to decide. E.g., governance proposal to pair EEFI with fungible versions of A-tranches can be passed.
EEFI is not a derivative of AMPL.
Semantically, this is correct.
The AmpleSense DAO deposits AMPL into the Elastic Vault in order to mint EEFI tokens, so EEFI is understood as a “derivative” of AMPL - at least empirically by a group of people, in this case.
FORTH’s utility is governing the ForthDAO that is dedicated to the growth and adoption of AMPL. Personally, I do not think there needs to be more utility.
This is why you, personally, have a say in the matter through your vote.
This seems to have cyclical reasonings. “Help us make EEFI great, to have a great EEFI.”
Taken out of context.
How is the vault not a value transfer from AMPL → ETH/EEFI with an optional buyback of AMPL?
The innovation of AMPL is not one of value transfer from price into supply, but rather one of volatility transfer. Therefore, timing matters. As you’re aware, this volatility is registered as a change in price for non-rebasing assets and a change in supply for rebasing assets like AMPL.
During the previous AMPL cycle, the absence of any scaffolds or ecosystem structures resulted in 70+% loss of value for AMPLers. Tremendous volatility was released in a short period of time. People lost fortunes and it could’ve drawn intense scrutiny were the bubble anywhere near as big as LUNA-UST. In addition to the giga-brain energy behind SPOT and its perpetual note, it does not hurt to have another channel for containing/transferring volatility via EEFI - especially, because this volatility will be transferred during the most violent times historically: negative rebases.
It’s either that or flight to USD, ETH, or other perceived SoV (FORTH, SPOT, tranches), which again enhances sell pressure on AMPL and non-linearly promotes contraction because these systems are reflexive with feedback loops. Depositing AMPL into the Elastic Vault removes it from circulation for 90 days. Through EEFI, volatility (or value) remains within the ecosystem under our governance. It can be redirected towards SPOT, public goods, or exclusively AMPL as the sub-vault already will automate some selling of EEFI for AMPL.
This is synergistic and symbiotic.