Summary
Utilize some Metronome Treasury owned assets to help backstop and dilute outstanding Vesper debt on Optimism from the Sonne exploit.
Abstract
Earlier this year, Vesper took roughly $2.5 million in debt due to exposure from the Sonne exploit. Almost all of the affected Vesper TVL is attributed to Metronome borrowers.
Immediate measures were taken between both protocols to repay a portion of this debt to maintain functionality of the pools and ensure that users may continue to safely use these pools or withdraw their funds.
The Sonne team and creditors have continued to collaborate with law enforcement to retrieve the stolen funds, as well as to launch a new DeFi primitive on Base, Make.Fun, with the intention to generate revenue that will help to reimburse creditors in the future.
We remain confident in the ability of the Sonne team and collaborators to achieve a favorable outcome. This proposal seeks to utilize a portion of idle treasury assets to enter a smart farming position that will add TVL to the Vesper USDC.e pool to alleviate the burden of debt further, enabling the pool to earn additional APY, which also accelerates the ability at which Vesper can generate revenue to repay debt more quickly.
Specifications
Transfer $200,000 worth of idle Metronome Synth assets from treasury wallets to OpComms on Optimism.
OpComms will convert the assets into USDC.e, deposit to Vesper, and enter a smart farming position targeting 4x multiplier for a $800,000 total deposit.
Expectations
Alongside previous backstopping measures, this proposal will ensure that USDC.e debt remains under 50% of the total TVL, where the pool can still earn 5%+ from external DeFi yield opportunities.