ARC: Bring AMPL to Avalanche Market

Hello Aavengers, Amplers, and Avax fam :wave:

After the rollout of AMPL to Aave V2 on Ethereum, I propose adding the matching AMPL market on Avalanche. This will bring a lower fee alternative for AMPL borrowing and depositing to users on the AVAX platform.

To maintain consistency and predictability for users, we should use the same configuration as the existing AMPL market on Ethereum:

Collateral Asset: No
Reserve Factor: 10%
Interest rate curve as defined by AIP-35

What is Ampleforth?

AMPL is a durable, fully-algorithmic unit of account.

The Ampleforth protocol transfers the volatility of demand from price per token to the number of tokens in user wallets by automatically adjusting supply in response to demand. Daily supply adjustments are automatic and non-dilutive.

For general information about the Ampleforth protocol, its motivation, use-cases, and behavior under live market conditions, see this Amplefort Network Durability report.

Ampleforth on Aave

The AMPL market was first proposed in October of 2020, deployed July 24th 2021, with an interest rate adjustment on Sept 18th, and a UI fix that finally surfaced the true rates to users on Oct 21st.

Since that time, we’ve seen the market size grow to over $14M, greater than 4% of the fully diluted AMPL market cap. In its short existence, strong engagement on both sides of the market has caused AMPL to be the largest revenue generator for the AAVE protocol.

Ampleforth on Avalanche

AMPL was launched onto Avalanche November 3rd with a Chainlink feed, and liquidity pools on Trader Joe and Pangolin. Further integration within the Avalanche ecosystem is being developed in collaboration with Benqi.

AMPL is bridged onto Avalanche by the Meter Passport platform, which is secured by relayers including Protofire, Harshquark, Wetez, InfinityStones, and Meter.

Governance Process

The official Avalanche<>Ethereum bridge does not support the generic transactions needed for bridged governance, so the governance actions on Avalanche are executed by the Aave community multisig as proxy. Ahead of any multisig action, we can still implement a snapshot vote of AAVE holders for the community to signal support. We will follow this process unless there are other objections!

Bringing AMPL lending to AAVE on AVAX would be an exciting step forward for all three ecosystems :+1:

Links to previous forum discussions:

Proposal: add support for AMPL
ARC: Update AMPL interest rate curve to account for over-approximation in compounded interest
ARC: Raise AMPL’s max interest rate

4 Likes

Ampl on ETH Aave clearly demonstrated why $Ampl is a ground breaking asset to lend. It sustainably returned lenders 2% a day for nearly three weeks. Borrowers also benefited hugely, as well as the AAVE platform, with $AMPL becoming the top revenue generating asset on.the platform at a fraction of the liquidity compared to USDC.

There were some discussions on it being problematic for pool utilization to remain at 100%. However, this is the cost for receiving such a high APY in a short amount of time, and the aAMPL/$AMPL pool on mooniswap offers a way ‘out’ for those who don’t want to have their funds locked.

There are so many lending strategies and that can automated on a low cost platform, Ampl truly opens the door for innovation.

Low gas fees will allow stablecoin lenders to seamlessly move out of their stablecoin position into ampl while the positive rebase is occurring, the transfer back into the stablecoin once it’s over, without spending $500-1000 on gas fees.

Ampl holders, lenders, borrowers, the protocol and Aave all greatly benefit from this.

Let’s make it happen!!!

1 Like

I am in favor of adding AMPL onto the Avalanche Aave v2 market.

We have seen that the aAMPL pool on ethereum has generated a significant amount of revenue for the Aave protocol, at peak utilization generating even more fees than the USDC market, despite a significantly smaller marketsize. Extending the aAMPL market onto Avalanche would allow Aave to grow this market, thus increasing protocol revenue significantly.

Other lending protocols on the Avalanche network, such as Benqi are working on integrating Ampl, by bringing Ampl to the avalanche market, Aave could help solidify its presence on Avalanche, ensure that it does not lose a valuable revenue stream to competing lending protocols and strengthen relationship with both the ampleforth, and avalanche communities.

Due to high fees on Ethereum, this market has been inaccessible to smaller traders, the low fees of the avalanche ecosystem would break down barriers to entry for this market, allowing for a more healthy lending market.

Since ampl would be added as a non-collateral asset, this would not bring additional risk to the aave protocol.

There has been significant debate on the governance forum, and elsewhere about the ideal interest curve parameters for the ampl market. Since avalanche is a separate market, we could potentially use this market as a testing grounds for alternative interest rate curves without disturbing the market on Ethereum.

Ampl and Aave are a great combo, and bringing this market to Avalanche brings significant benefits for both protocols. I hope to see this proposal pass!

I am to hoping to be able to participate in the lending on $aave of $ampl. As someone who is still holding loans on $eth chain of $ampl I’m experiencing what happens when not enough people are engaged in the network.

Many people have been unable to participate as a result of the untolarable gas fees for smaller people trying to experience the world of DeFi. Having the ability to use this new world and help people understand the joys of what Elastic Finance is about to bring the the masses. While it is out of reach of many we continue to see the rise and fall of utilization. By allowing ampl to be used as it is on ETH will continue to show people the future of credit & money in the hands on the people!!!

$ampl builds DeFi as shown from Summer 2020, Geysers were not a thing before $ampl

What will $ampl do when it is across all chains and on all lending platforms on all chains… It becomes the Unit of Account to BTC Store of Value!!!

The Future
#ghostMONEY

As other have touched on, bringing AMPL to Avalanche AAVE opens the door for new possibilities, and accessibility.

There are a lot of speculators that cannot participate in AMPL AAVE on ETH because of the extremely high gas fees. With AMPL AAVE Avalanche, I believe a large % of those speculators will stick around due to the immense value that AMPL brings to both borrowers and lenders.

AAVE seems to be on the cutting edge in helping to pioneer elastic finance. The Avalanche market is the next step and may actually become AAVE’s top pool, since the barrier of entry will be lowered significantly.

AAVE + AMPL on ETH was a great preview of what could be, however with no barriers - AAVE + AMPL on Avalanche can make history.

AMPL has already been generating around 13% of AAVE revenues in the last 30 days just from the Ethereum Market. I think it’s a wise idea for AAVE to expand on the already profitable idea and bring AMPL to the Avalanche market.

The fees on Ethereum are causing a high barrier of entry for smaller investors who would have liked to get involved, but couldn’t. Expanding to Avalnche will not only lower the barriers of entry, but also increase the revenue for AAVE DAO substantially.

I support this proposal.

1 Like

I agree this proposal. With AMPL in many use cases, it will be a great coin.

Thanks everyone for the feedback so far.

There appears to be support so we’ll plan to kick off the Snapshot vote next Monday, December 6th!