[BIP-XXX] Enable jEUR-EURe Gauge [Polygon]

Summary:

Enable a Balancer gauge for the Polygon jEUR - EURe stable pool, coined 2eur (EURe).

EURe and jEUR are both Euro stablecoins. EURe is backed by Euros and issued by Monerium, and jEUR is backed by crypto and is issued by the Jarvis Network.

Jarvis Network writes the proposal. We have already a history of incentivising the 2eur (EURe) pool on Curve (we stopped last November), and we want to move the pool on Balancer.

References/Useful links:

Jarvis Network:

Link to:

Monerium:

Link to:

Protocol Description:

Jarvis Network

Jarvis Network is an ecosystem of protocols and applications to bring decentralized finance to real use cases. Its first protocol, Synthereum, allows borrowing and exchanging synthetic fiat currencies (jFIATs) on multiple EVM-compatible networks.

The Synthereum protocol has four modules:

  • Liquidity Pools: exchange jFIATs back and forth for USD-stablecoins or other jFIATs without price impact at the Chainlink price feed.
  • Credit Lines: borrow jFIATs against various collateral types.
  • Wrappers: convert non-USD stablecoins for their jFIATs equivalent at a 1:1 ratio.
  • Printers: mint uncollateralized jFIATs for flash loans, seeding money markets, or liquidity pools.

Most jFIATs have a direct fiat on and off-ramp (Mt Pelerin, Suarmi) or indirect (Monerium, Paytrie, Transfero etc.), can be lent or borrowed on money markets (Aave, Midas, 0VIX), can be used for on-chain and off-chain payment (Request, Superfluid, Mt Pelerin) or for earning yield (Beefy).

Monerium

Monerium is authorised and regulated as an Electronic Money Institution (EMI). Monerium offers services to residents of the European Economic Area, the UK, and Switzerland. Monerium is authorised to issue e-money tokens on blockchains.

Monerium issues the EURe, a Euro stablecoin with a 102% backing. EURe is more than one-to-one backed in high-quality liquid assets and is redeemable on demand. Unlike a bank, an Electronic Money Institution can only safeguard customer funds but not make loans.

Motivation:

The role of the 2eur (EURe) pool is to increase the stability of EURe (1), the on-chain liquidity of both EURe and jEUR (2), and connect the Monerium and Jarvis ecosystems (3). Together, these 3 points allow for building an European DeFi ecosystem.

  1. EURe peg: EURe is often under or over its peg due to its limited liquidity and arbitrages opportunity. This pool will allow for performing arbitrages, increasing EURe stability.
  2. On-chain liquidity:
  • EURe: since jEUR can be exchanged for USDC and ETH without price impact, then exchanging jEUR, ETH or USDC for any other token has the same price impact; users can swap EURe to jEUR and then to USDC or ETH to access the latter’s liquidity or vice versa. This considerably increases EURe liquidity.
  • jEUR: jEUR main liquidity source is the Jarvis Liquidity Pool (primary market); without entering too many details, if the pool performs well, it will increase the number of jEUR minted, which will increase the liquidity in our Liquidity Pools and our Wrappers, which is vital to us; also, it is essential to us to have more liquidity sources (secondary markets), and this is why we are launching this pool.
  1. Connect ecosystems: the 2eur pool connects Monerium and its EURe (essentially an IBAN connected to the Blockchain, and a fantastic on and off-ramp) to the jEUR’s ecosystem, enabling multiple use cases.
  • Credit without FX risk: borrow jEUR, swap for EURe then off-ramp EURe.
  • DeFi on-ramp and off-ramp: EURe can be minted by depositing Euros into one’s personal IBAN. Euros payment can be initiated by burning EURe. One can buy jEUR and swap them for EURe to off-ramp, or mint EURe and swap them for jEUR for on-ramp. Because jEUR can be converted for ETH or USDC at the oracle price feed, it creates the most direct and cheapest fiat on and off-ramp for Europeans.

A few notes:

  • Jarvis LTD has started building positions in BAL, TETU and AURA. The Jarvis Network treasury (governed by the JRT token, which will soon be revamped using the ve-model, a new token called JARVIS, and an 80/20 JARVIS-ETH pool) has a position in TETU.
  • Jarvis LTD and the Jarvis Network treasury will both supply liquidity in the Synthereum Liquidity Pool. They will use up to 50% of the fees generated through the Liquidity Pools for vote incentives for veBAL, vlAURA, tetuBAL etc. (we have already done this successfully for a few months now on BNB Chain with Ellipsis / DotDot).
  • The 2eur (EURe) pool on Curve did a volume volume of $2M since September 2022, and was incentivized between September and November 2022, with a TVL that went up to $700k (today it has $25k left and still has activity).
  • We also are deploying a 2eur (EURe) on Balancer on Gnosis Chain.
  • Moving forward, we will deploy a boosted pool using Midas whenever possible to avoid fragmenting the liquidity between AMM and money markets and earn higher real yield.
  • Finally, we will also deploy a 2eur (EURS) and 2eur (EURT) pools.

Specifications:

  1. Governance:
  • Jarvis: no on-chain governance (vote via snapshot) and decisions are executed through a ⅝ multi-sig (only one team member in the signers).
    • Polygon: 0x2709fa6FA31BD336455d4F96DdFC505b3ACA5A68
    • Ethereum: 0x2CA74be68f0A0e053F030D143C1376806BaBEdc9
    • Gnosis Chain: 0xaE1026699f47B1fC572D65E1784b12c3A2574A25
    • BSC: 0x38329F26a075D53324EFd6e5F53869354Fa1cfBc
    • Avalanche: 0x2507A0d8E2aBe9464Ba2d9ddcA38A5ee5e60A434
    • Optimism: 0x40bd131fA9933D592344783E38f0c0F27767d9FA
  • Monerium has no on-chain governance.
  1. Oracles: jEUR uses EURUSD and computed ETHUSD (ETHUSD / EURUSD) Chainlink price feed; (Chainlink: EUR/USD Price Feed | Address 0x73366Fe0AA0Ded304479862808e02506FE556a98 | PolygonScan 1) Chainlink price feed.
  2. Audits:
  1. Centralizing vector: jEUR is mainly collateralized by USDC; Monerium is backed by Euros.
  2. Market history: jEUR has been live since August 2021 (on Polygon); it has never traded off its peg. EURe has been live since May 2022 (on Polygon); as Monerium can be minted/redeemed against Euros, it has held its peg even though its low liquidity creates stability issue time to time (always arbed).
  3. Value:
  • The 2eur (EURe) pool will act as the main route on and off-ramp on Polygon for European users, and main route for arbitrages and the use cases mentioned above (on-chain liquidity, credit without FX risks, etc.).

Contracts

  • 2eur (EURe) Balancer Pool (Polygon): 0x19017f2919A5Fb7ECa1f0D142330644DC2045423 (AMP 200; trading fees 0.05%).
  • jEUR token (Polygon): 0x4e3decbb3645551b8a19f0ea1678079fcb33fb4c
  • jEUR (Polygon Synthereum Liquidity Pool): 0x65a7b4Ff684C2d08c115D55a4B089bf4E92F5003
  • EURe token (Polygon): 0x18ec0A6E18E5bc3784fDd3a3634b31245ab704F6
  • Gauge: 0x091ef8E7f00165E4F58B02983Ca6AFa9ca060934
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