xSUSHI
SushiSwap is a DEX forked of Uniswap that grew very fast, now at $1.6B of TVL, thanks to generous liquidity mining incentives. It is now part of the Yearn conglomerate with many new upcoming features.
xSUSHI is the staked SUSHI that receives .5% of the fees with 10 to 40% APY a great property for a collateral. The redeeming process from xSUSHI to SUSHI is permissionless allowing the analysis to focus on SUSHI.
SUSHI Smart contract Risk: B-
SUSHI was launched late August by a fork of the Uniswap Exchange. Shortly after launch, the key developer stole the development funds, eventually returning them. The network managed secure support from some industry leaders and has grown fast in these few month reaching two dozen users and over a billion transactions.
SUSHI Counterparty Risk: B
Sushi is a permissionless blockchain protocol where token holders vote on incentives and upgrades. Anyone can create new Sushi markets.
SUSHI Market Risk: C +
SUSHI has a good market capitalisation with a high volume. The price has suffered from extreme volatility since inception, suffering from large drops in value which is problematic for a collateral, requiring prudent parameters. This was driven by internal drama which also deeply affected community trust, now on the mend.
Risk Parameters ~ New (also proposed for SNX)
LTV 25%
Liquidation Threshold 45%
Liquidation Bonus 15%
Reserve Factor 35%
Variable Interest Rate Model ~ Collaterals
UOptimal 45%
R_0 0%
R_s1 7%
R_s2 300%