After launching its Venus V2 upgrade, the start of a new single currency revenue pool service, users have reported losses from it. The fee generated has been attributed to be the cause of the losses.
Venus’ Single Currency Revenue Pool Losses
The Venus single currency revenue pool proposal started on April 15th and allowed $XVS holders to withdraw their Venus assets at a rate of 0.01%. For instance, withdrawing $100,000,000 from Venus will only attract a fee of $10,000. However, some project parties weren’t adjusted to accommodate the rate changes and some community members raised this concern in the community. While it was disclosed that the fall-off was being put into some ecological projects, most community members still had their doubts. Now, their doubts have been confirmed after these reported losses.
Synchronization of Events
The following events have been outlined by the Venus team in their latest Medium post:
14/02/2021. A release of the “2021 Venus agreement development plan” by the Venus team. The first section of the plan’s original text reveals that “small fees will be added to the Venus founding fees to create and redeem loans from the agreement. This fee is 1 basis point and it is approximately 0.01%”
14/03/2021. The Venus team provided updates regarding the plan through Twitter
30/03/2021. Community approval of the Venus V2 upgrade plan as announced on Twitter by the Venus team
13/04/2021. Another Venus twitter announcement: upgrade to start on the 15th. They also released details of how the upgrade will affect related projects.
15/04/2021. Another upgrade progress via Twitter revealed that the fee will be for non-BNB asset withdrawal from Venus.
Beefy.Finances’ Analysis of the Situation
The Beefy.Finance team was able to identify this issue early on through monitoring the Venus update proposal. The Panic() function was called upon realisation of the issue, withdrawing and pausing all Venus vaults. The team has outlined the following events in their Medium announcement:
The Venus proposal passed and the implementation was queued. On April 20, Venus executed their proposal with its planned fee upgrade.
However, some yield optimization platforms did not upgrade their vaults. The changes led to a loss of funds for DeFi users who had staked their assets directly on Autofarm’s Venus Vaults and Belt Finance’s Stable coin vault.
Given the current implementation, the vaults lose the fee implemented by Venus whenever a withdrawal is executed. A percentage of each users staked amount is lost every time someone withdraws.
Venus’ solution is to communicate closely with important ecological members and integrate revenue strategies that can help community members recoup much of their losses. They also intend to work with their partners to brainstorm logical solutions in the shortest time. Also, the Venus team is considering an establishment of the ecological co-construction alliance in the nearest future. The aim/objective of this alliance will be to ensure complete protection of user assets from loss and prevent a recurrence of this loss that happened to their members or similar ones.
As a lending BSC dApp, security is an important focus for Venus. This will allow for regular communication and discussion of development between protocols. This alliance will attempt to address issues regarding the agreement with no limit on community members that would be accepted
Source : bsc.news
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