[xSUSHI] MIP6 Collateral Onboarding Application for xSUSHI (Sushibar) Token
- Who is the interested party for this collateral application?
- Provide a brief high-level overview of the project, with a focus on the applying collateral token.
xSushi is one of the two currently supported assets for Sushi governance (ETH/SUSHI SLP being the other one). We are currently not fully decentralized but the members of the Ops multisig and Treasury multisig are bound to respect all of the governance votes. We do plan to be a real DAO most likely leveraging Aragon v2 in 6 to 12 months depending on the progress made by the community.
xSushi receives 0.05% of all the swaps happening on the Sushiswap AMM and should also benefit from all of the future revenues streams from upcoming platforms such as Bento, Miso, Gusoku, Deriswap and more. The current yield on this asset is hovering around 10-40% APY with over $100MM locked in the Sushibar making it an ideal productive asset as collateral.
- Provide a brief history of the project.
Sushiswap was launched by pseudonymous individual Chef Nomi in August 2020. The core code was forked from Uniswap v2, with a few changes: the 0.05% protocol fee was turned on, and a governance token (SUSHI) was created to manage the platform and receive revenue. Chef Nomi also created staking contracts that would incentivize existing Uniswap LPs to migrate their liquidity to the new platform.
The project ran into controversy when Nomi unexpectedly sold SUSHI from the dev fund. After this point, FTX/Alameda Research principal Sam Bankman Fried stepped in to organize a multisig to manage the development fund and migration. Nomi eventually returned funds to Sushiswap and then left the project. New contributors such as 0xMaki stepped up to manage development and day to day operations.
After Sushiswap launched and completed the liquidity migration, Uniswap released their own platform token and launched a competing liquidity mining program. This was largely responsible for a decline in Sushiswap volumes and liquidity from September to November.
Since the trough of the defi market drawdown in November, Sushiswap has experienced a virtuous cycle of increasing volume and liquidity driving token price, which in turn amplifies liquidity incentives and further improves fundamentals. The platform is also investing in new products and services beyond the core AMM which may lead to further value accrual and differentiation from other DEX platforms.
- Link the whitepaper, documentation portals, and source code for the system(s) that interact with the proposed collateral, and all relevant Ethereum addresses. If the system is complex, schematic(s) are especially appreciated.
Documentation: Introduction - Sushi
Source Code: SushiSwap · GitHub
xSUSHI token contract: https://etherscan.io/address/0x8798249c2E607446EfB7Ad49eC89dD1865Ff4272
SUSHI (underlying asset of xSUSHI) token contract: https://etherscan.io/address/0x6b3595068778dd592e39a122f4f5a5cf09c90fe2
- Link any available audits of the project. Both procedural and smart contract focused audits.
Quantstamp: GitHub - quantstamp/sushiswap-security-review
- Link to any active communities relating to your project.
Gov forum: https://forum.sushiswapclassic.org/
Discord: SushiSwap Community
- How is the applying collateral type currently used?
xSUSHI is a tokenized representation of SUSHI tokens deposited to the Sushibar rewards contract. 0.05% of any swaps on the Sushiswap AMM are accumulated in SUSHI tokens and distributed to xSUSHI. This works via automatic compounding, so each xSUSHI token represents an ever increasing amount of SUSHI in the staking contract.
While xSUSHI’s primary purpose is to receive protocol earnings and vote in governance, it is also beginning to be supported by defi protocols. There is around $1 million of xSUSHI liquidity on Sushiswap itself, and Aave is also onboarding xSUSHI to their v2 lending platform.
- Does one organization bear legal responsibility for the collateral? What jurisdiction does that organization reside in?
xSUSHI is a decentralized asset. It does not represent a legal claim or liability of another party.
- Where does exchange for the asset occur?
The primary method of exchanging xSUSHI is to swap it for SUSHI tokens directly in the Sushibar contract (with no slippage or fees other than gas required to exchange between them). SUSHI is widely traded on centralized and decentralized exchanges. Top CEX venues include Binance, Huobi, OKEx, FTX, and Bitfinex, while the largest DEX venue is Sushiswap itself.
- (Optional) Has your project obtained any legal opinions or memoranda regarding the regulatory standing of the token or an explanation of the same from the perspective of any jurisdiction? If so, those materials should be provided for community review.
- (Optional) Describe whether there are any regulatory registrations for the token and provide related documentation (including an explanation of any past or existing interactions with any regulatory authorities, regardless of jurisdiction), if applicable.
- (Optional) List any possible oracle data sources for the proposed Collateral type.
Centralized exchange platforms listed in section (9) may be able to offer price data for SUSHI. xSUSHI price can then be computed by multiplying SUSHI price times the SUSHI/xSUSHI exchange rate. See Aave’s asset onboarding proposal for details of their implementation.
- (Optional) List any parties interested in taking part in liquidations for the proposed Collateral type.
Disclosure: Interested parties have financial stake in the SUSHI token. This collateral application is for informational purposes only, and does not constitute advice of any kind.
Copyright and related rights waived via CC0.