TempleDAO Announces Comprehensive Partnership with Fei Protocol
The FEI token is a crypto-native scalable stablecoin pegged to $1 USD at no less than 100% collateralization. The Fei Protocol supports the peg by algorithmic management of its reserve assets to support direct redemption. The assets which can be used to back minting or redemption will vary among DAI, ETH, and LUSD depending on market conditions. Fei Protocol is governed by TRIBE token holders in a decentralized manner.
Tribe DAO has recently announced the launch of the Turbo program, a liquidity accelerator that allows any token to become productive through the yield generated from a costless line of FEI credit. Select partner tokens may be whitelisted as an approved collateral asset to access this line of credit. Through deposit of the whitelisted asset, the FEI minted through the Turbo Safe contract would be directed to ERC-4626 compliant yield-generating vaults such as the Fuse lending market. In exchange, Tribe DAO will receive a portion of the revenue generated from the vault.
TempleDAO is inspired by Fei Protocol’s vision of decentralized monetary expansion and permissionless collateralization. Our steady Treasury growth philosophy and token price stability through vigorous defense of intrinsic value (IV) make us a natural partner for FEI. We are eager to see $TEMPLE added as one of the first tokens to the Turbo program.
The number of FEI tokens TempleDAO may be allowed to mint through Turbo will be commensurate with how much FEI demand the TEMPLE protocol generates. The conversion of Temple Defend funding from FRAX to FEI is part of the new demand that will be taken into account, as well as the FEI transaction volume from our custom AMM liquidity pool, which has seen over $270M in total volume over the past five months.
To start our new partnership on the right foot, TempleDAO has restructured the AMM contracts as follows:
- Seed a new uni v2 LP token on our custom AMM: FEI/TEMPLE. Concurrent with the existing FRAX/TEMPLE pair, users will be able to directly swap between FEI and TEMPLE using our Protocol-controlled liquidity.
- Redeploy the Temple Defend contract to be funded and replenished with FEI token.
By switching the funding for the Temple Defend contract, users will now receive FEI instead of FRAX when they sell TEMPLE into the IV price floor. The Defend contract will treat FRAX and FEI as equivalent, meaning 1 FRAX = 1 FEI. Whether you sell through the FRAX/TEMPLE LP or the FEI/TEMPLE LP, you will receive your TEMPLE IV in FEI (currently at $0.66 USD). This conversion will reduce additional idle capital that would otherwise be created if the Temple Defend allocation were split into two different tokens.
In summary, TempleDAO is delighted to partner with Fei Protocol through Tribe DAO. By collaborating with a leader in stablecoin technology and permissionless line of credit, we hope to maximize TEMPLE token holder returns through safe DAO leverage, as well as bolster utility and price stability. We are hopeful that by adding TEMPLE, which is also supported by significant Protocol-controlled value and a robust redemption mechanism, the Turbo program can achieve its objective of increasing FEI collateral diversification into premium low-volatility crypto assets.