Bankless has a lot to offer with helping launch this product and growing AUM - that is clear and exciting opportunity. Index Coop has a lot to contribute here as well, especially when it comes to maximising the extrinsic productivity. ie: Collateral on lending platforms etc…
I do think there are other things to consider, reading over the previous post, I have a few queries. I thought BED was static, fixed allocation amongst BTC, ETH & DPI - now I am not sure, it reads like the methodology is fluid with potential to swap some of the assets with productive variations. I am a fan of utilising productive assets. But if that is the case, the methodology needs to be restructured to include some kind of qualitative component to it like DPI. Something that says why one productive asset has been selected over another.
This value add, improves the appeal of the product, adds to the complexity and leads us to rethink the streaming fee discussion. A productive BED for me has a larger AUM potential, but the methodology needs to be flushed out though before the absolute value of the streaming fee paid by client can then be agreed.
The value of the streaming fee is a product and market fit conversation. Things like how much can be charged before people seek to make their own portfolio instead of using a turn key solution. Obviously if the target client is someone investing $30k, then gas costs are a lot less significant than clients looking to invest $1k. I’d love to see a bit of target client discussion, potential AUM size and pin down the methodology.
A static passive BED for me is low 0.30% otherwise, I’ll be honest it makes more sense to do it myself. Something productive is higher, say 0.60% with an estimated APY >5%. This has be me a lot more excited as it has a huge time saving component to it for me. Ideally for be, I would like the user experience to be that the receiving APY doesn’t require a staking contract and can be something like xToken’s products where the compounding is built into the product. Although, this compounding element will increase Impermanent loss for LPs. I’d be keen to see what the methodologist is proposing for Index Coop’s / SETs engineering team is to build. So we can understand the complexity and how it fits in the market.
After agreeing the streaming fee for the product, then the conversation shifts to deciding the fee split. To assist with that conversation we are developing a framework Methodologist Fee Menu. This is still being reviewed and subject to change, but it gives a flavour for how the streaming fee are shared.
The larger the AUM, the larger the royalty stream, so let’s work together to optimise this product and bring it to market.
