Yes you are correct on all accounts. My proposal specifically addresses your question of “how do we get to that point in terms of assets:?”. We get a line of credit from Iron Bank and withdraw stablecoins to put into CGI/ETH.
In my opinion this is the best option possible because we can turn a profit while also making our products more usable. Double bonus is we can put up DPI from treasury as collateral (if Iron Bank asks for some instead of no collateral) which lets apps like Alpha Homora use it in leveraged DPI/ETH farming further solidifying DPIs prominence in the DeFi ecosystem.
If you look at my napkin math, its way cheaper than paying INDEX for liquidity mining (my calculation assumes an interest rate 10x higher than current market).
Lets assume a pretty bad interest rate of 30% APY (current is ~3%), we can take out a $40M stablecoin loan, add that to DPI/ETH pool, and still be paying the same $1M / month as today with almost the exact same amount of liquidity ($40M vs $48M now).
If INDEX distribution is a concern, this actually lets us get INDEX to a more diverse crowd than just LPs by freeing up capital for another creative challenge, full-time hires, CEX listings, etc.
The only LP risk is if both CGI and ETH dont increase in USD price faster than interest rate which should be taken into account but over any significant time horizon is a small probability.