MIP 23: Remove mUSD from Iron Bank

Summary

The mUSD from both Feeder Pools (mUSD/GUSD and mUSD/BUSD) is allocated in the Iron Bank since MIP 11 has been enacted. In light of recent events around the exploit of Cream Finance, it is proposed to remove this integration and move the mUSD into a dummy integration contract for the time being.

Abstract

The mUSD from both Feeder Pools (mUSD/GUSD and mUSD/BUSD) is currently supplied to the Iron Bank and earns at the time of writing around 0.18%. Therefore it seems that the additional risk caused by this integration doesn’t warrant the earned yield from this pool - it’s not a significant amount to justify this.

Since the smart contracts for the feeder pool can’t move from integration back to having no integration, a dummy integration contract is needed to replace it. This dummy integration would simply hold the funds and does not supply them to any platform.

Motivation

Since the exploit of Cream Finance and the uncertain future around it, we should reconsider the Iron Bank integration. The very low yield that is generated by this integration does not warrant the increased risk. Our shared value as a protocol is a security-first approach - this proposal falls in line with this approach.

Technical Specification

Two instances of the smart contract DudIntegration.sol are to be deployed for each feeder Pool with the following constructor arguments:

  • mUSD/GUSD Feeder Pool:
    • nexus = 0xAFcE80b19A8cE13DEc0739a1aaB7A028d6845Eb3
    • lp = 0x4fB30C5A3aC8e85bC32785518633303C4590752d
  • mUSD/BUSD Feeder Pool
    • nexus = 0xAFcE80b19A8cE13DEc0739a1aaB7A028d6845Eb3
    • lp = 0xfE842e95f8911dcc21c943a1dAA4bd641a1381c6

After deployment, the ProtocolDAO multisig will queue two transactions for each Feeder Pool to migrate the assets to the new integration:

  • Call migrateBassets([0xe2f2a5C287993345a840Db3B0845fbC70f5935a5], _newIntegrationAddress)

The _newIntegrationAddress will be the aforementioned deployed address of the contract DudIntegration.sol for the corresponding Feeder Pool.

Next Steps

Pending no significant changes to its content, this proposal will be taken to snapshot vote on Monday, 29th November 2021. Voting will be open for a 5 days window to give adequate time for a concurrent discussion. Governors can change their vote at any time should the discussion sway their decision. We look forward to hearing what MTA token holders have to say and seeing how they cast their votes.

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The vote is live: Snapshot