How Pangolin can help solve the problem fiat on ramp problem and grow the avalanche network

Hi all!

Context: TrueUSD provides a low cost and native fiat on/off ramp to avalanche

  • If you live specific areas (e.g., California), it’s currently very difficult to turn fiat into avax.
    • I personally spend about a month figuring out how to do it, ran through the KYC at 3x different places and jump through 3x different conversions (with significant fees at each jump) to turn fiat USD to avax.
  • This feels like a pretty big impediment to the growth of our community, and the growth of the price of avax.
    • It’s hard to get all the firepower of places like silicon valley if they can’t even buy the token without waiting weeks.
  • If you hadn’t noticed, TrustToken introduced a stablecoin native to avalanche (TrueUSD, TrueAUD, etc.)
  • To be clear, you can just wire them fiat money and turn it into newly minted stable coins directly on the avalanche C chain (without going through etherium bridge, etc.) You can turn in the tokens to them to get fiat currency back.
    • I can vouch as a resident of California, within a day I could get my KYC approved, wire them $X fiat usd, and receive X TrueUSD stable coins sitting in my avalanche wallet.
    • You’ll note the non-existent fee there compared to the multiple high fees I paid previously purchasing avax by going through (coinbase charges fee to buy eth with USD)-> (coin base charges a fee to send eth to to → ( charges a fee to buy avax with eth) → ( charges a fee to send avax to wallet.)

The Problem

  • That was the good news. Here’s the problem.
  • Currently, once you get these stable coins, there’s no real way to turn it in AVAX or PNG anything else.
  • The current pangolin pools are extremely under-utilized compared to other etherium-based stablecoins such as USDT/DAI – I think we’ve had exactly 1 swap so far.
  • Since no one is using it, the pricing has become completely out of wack. You’d be kinda crazy to add to this pool when it wants you to contribute $40 of stablecoin with each avax coin. Thus no one contributes, and no one uses it, causing a vicious cycle.
  • Thus, no one knows about TrueUSD or bothers to swap to it, or realizes this on-ramp exists.

How Pangolin can help solve the problem and grow the avalanche network

  • For any incentives we give to pools for other stablecoins (e.g., DAI, USDT), start giving similar rewards to TUSD.
  • Since the good people at TrustToken took a chance of being an early adopter and are one of the first companies to build stablecoin native to avalanche, possibly we should consider giving slightly better incentives for TUSD as compared to the non-native-etherium-based stable coins.
  • Thus more people will realized the value of swapping between other currencies and TUSD and raise awareness of this extremely useful & low cost fiat on/off ramp — effectively raising the amount of real value flowing into the avax network.
  • Possibly reset the pricing of these pools, so it’s rational to fund them again (who wants to contribute when the price is so far off from USDT-to-avax?! and then no one can swap it to fix the prices because the pools are empty.)

Your thoughts?

  • Would love to hear comments on this proposal so it can be revised and improved.
  • I hope people agree with the value of a low cost, native fiat on ramp and are excited to use our governance to help grow it.

oops lots of typos in here and it wont let me edit it… sorry i typed this out on my phone in bed :stuck_out_tongue:

Hey did you know that the Snowball StableVault s3F vault lets you swap between USDT, TUSD, and FRAX?

There is ~20k TUSD there right now

@Leo_Pangolin great news. thanks for the pointer. My hope is that Pangolin can also help support the growth of this low-cost avalanche-native on-ramp to fiat.