Protocol Owned Liquidity, not incentives!

The Problem:

There are a lot of proposals going around

“UST incentives on UST-SCRT”
“UST incentives for MIM-UST”
etc etc

Let’s say we do this for 6 months, and the rewards dry up. The liquidity disappears! We will need new incentives, forever and ever. Some of the incentives might come from the other side (Abracadabra, Frax, scrt, etc), but I think we can all do better.

The Solution
Take Frax for instance. Instead of UST and Frax being provided as incentives on the UST-Frax pool on Curve, instead let’s send some UST from our community pool to Frax, in exchange for an equivalent amount of their stablecoin.

Now, both protocols own a bunch of UST and Frax, and can own their own LPs.

This is liquidity that not only will never go away, it will be a profit center, rather than a cost center for the protocol.

We can do both!