Clear Idle Prisma PSM Funds

General
1

Overview

This proposal aims to:

  • Recover remaining crvUSD from the Prisma PSMs to Resupply Treasury.
  • Deprecate the mkUSD and Ultra PSMs as a liquidity source, encouraging any users with mkUSD / ULTRA positions to exit via liquidity pools

Recovered funds will be used at Resupply treasury’s discretion. For example, may be used to make a partial repayment to the open Yearn loan obligation.

Background

When the now-defunct Prisma protocol shut down, ownership was transferred to Resupply governance.

As part of Prisma’s wind-down, a mkUSD PSM and an Ultra PSM were created to allow users to make a graceful exit with ample time. More than one year later, these PSMs have no recent activity still hold ~250,000 crvUSD. This is believed to represent effectively dead TVL.

This proposal has no impact on remaining Prisma users’ ability to withdraw their collateral from Prisma trove managers.

Specification

This proposal executes two actions:

  1. Deploy a redeemer instance for the mkUSD Prisma factory
  2. Deploy a redeemer instance for the Ultra Prisma factory

The redeemer contracts are special purpose Trove Managers authorized to mint mkUSD and ULTRA respectively. Upon redemption, the redeemer mints the required amount and immediately redeems it against the PSM for crvUSD. The crvUSD is atomically sent to the Resupply treasury and the PSM burns all mkUSD/ULTRA received as part of the transaction.

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I am mostly in favor of this. However, I wonder if some of the funds should go to RSUP stakers. It seems like a lot of the people who locked their PRISMA are dumping all the RSUP they receive. Incentivizing them not to dump their unlocks might reduce the constant sell pressure (which we still have around a year of iirc)