The goal of the page is to determine how much we are paying each protocol agent, and if we are over-paying specific pools.
One thing to keep in mind is that the roles of each actor (HA, SLP, or agEUR LP) is very different for the protocol.
In the first version of this analysis, we looked only at HA and SLPs. Here we also look at figures from the different agEUR pools.
<aside> 💡 All the numbers shown below should be taken with a grain of salt. They are approximations, and the calculations are made to give us a general idea of the situation.
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Why do we pay HAs?
→ The protocol needs to attract HA to hedge the protocol reserves against price change. This is the main mechanism that helps back the stablecoins issued by the protocol.
To calculate the cost of attracting HA capital to cover the protocol funds, we can divide the amount paid by the protocol in ANGLE tokens, by the total quantity of capital covered by HA (hedge ratio x user funds in the protocol), the capital incentivized in the table.
$$ \texttt{payout yield = amount paid in ANGLE / capital incentivized } $$
This also tells us how much Perps holder receive for their position size: if it’s very low, it means they are probably not coming for this but rather for the short EURUSD position itself.
Another metric is the capital / $ANGLE spent. It tells us how much capital (Perp position size, or cover amount) we attract for $1 of ANGLE distributed.
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💡 The revenue from HA column here mainly looks at the revenues from the current open positions (for tx fees), and not the past ones that were closed.
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ANGLE distribution Efficiency - Perps
As we can see from the table, the current Open Interest / $ANGLE is high for USDC (and, conversely, the payout yield is low at 0.62%), while the total position size has historically been much higher. This tells us that HAs are not interested by the potential ANGLE rewards, but rather by the PnL opportunities of trading on EURUSD.
It also appears like believe that the differences in Hedge Ratio between USDC, DAI, and FRAX is due to preferences in which token to use, rather than in the quantity of ANGLE distributed in the pools.
We think it would be a good thing to kill Perps gauges altogether.