TokenPhysicist

We just crossed $1B in total volume!

This is still subsidized, by the way. Hope everyone who aped into this at 40% and 20% and 15% are monitoring it 🫠 As pointed out before, the risk here is illiquidity. There’s no incentive for the one large borrower to repay, and they also control all the parameters (hence manual adjustments of yield ever lower to a target range that’s absurdly low). So once other depositors withdraw and utilization gets high, you’re stuck until new depositors show up.

Hello everyone, it is with saddened hearts that we announce the shutdown of Bunni. The recent exploit has forced Bunni's growth to a halt, and in order to securely relaunch we'd need to pay 6-7 figures in audit & monitoring expenses alone – requiring capital that we simply don't have. It'd also take months of development & BD effort just to get Bunni back to where it was before the exploit, which we cannot afford. Thus, we have decided it's best to shut down Bunni. Here's what will happen: - Bunni users will still be able to withdraw assets via the Bunni website until further notice. - We intend to distribute the remaining treasury assets to BUNNI, LIT, and veBUNNI holders based on a snapshot. However, the validation of the legal process is ongoing, and the exact details of the distribution will be shared at a later date once the legal process is finalized. Team members will be excluded from the snapshot. - The Bunni v2 smart contracts have been relicensed from BUSL to MIT, enabling everyone to utilize our innovations such as LDFs, surge fees, and autonomous rebalancing. We have pushed the AMM space forward by a generation, and it would be a shame if our efforts went to waste. - We will continue working with law enforcement to recover the stolen funds from the exploiter. Thank you to everyone who has supported us throughout our journey to push DeFi forward.

Checking in on this special vault to lend against SKY, the (still subsidized!) yield has now been manually adjusted down to 10%. It’s amazing to me for people to lend into a market dominated by a single borrower with no history of repayment (so liquidity likely only comes from new depositors), who also controls the oracle, liquidation, LTV, and interest rate parameters. Especially with the interest rate they pay being manually adjusted from 20% to 10% over the last three days! The spread between sUSDS and stUSDS is a mere 550 bps and still not at its unsubsidized or equilibrium rate. That there are people in this makes me think that yield opportunities at scale (>$5m) must be getting scarce. Because as lopsided as the risk-reward is, it’s always against a standard of “compared to what” The top lender appears to be Fasanara, who are presumably monitoring liquidity.