A Polygon DAO neighborhood cohort is contemplating a proposal to make use of its greater than $1 billion of idle stablecoin reserves, at present held on the Polygon PoS Chain bridge to seize yields, per a pre-proposal governance put up.
“The PoS Bridge currently holds around $1.3B of stablecoins, which makes it one of the largest, but also idle, holders of stablecoins onchain,” the pre-proposal reads. “At the current benchmark lending rate for the 3 major stables this is an opportunity cost of around $70M annually.”
“The authors believe that DeFi as a whole has matured whereby assets held in the Polygon PoS bridge can be used productively and securely to incentivize additional activity on Polygon PoS,” it added.
DAOs are organizations represented by guidelines encoded as laptop applications, managed by the token holders associated to that group and never influenced by a government.
The plan includes utilizing Morpho Labs’ vaults to handle USDC and USDT concentrating on a conservative 7% annual return by methods that embrace high-quality collaterals like USTB, sUSDS, and stUSD.
That would make Polygon a further $70 million yearly from idle property. The yield generated could be reinvested again into the Polygon ecosystem, supporting progress throughout the community and its ecosystem.
If the concept passes an preliminary neighborhood test, the proposal will purpose to generate yield by regularly deploying dai (DAI), USD Coin (USDC) and tether (USDT) from reserves into decentralized finance (DeFi) protocols.
Deploying every asset would require a separate proposal to be floated and handed by the neighborhood sooner or later.
Polygon’s POL is down 5% prior to now 24 hours alongside a broader crypto market slide.
