It’s clear that there’s not enough demand for USDx. When this happens supply must decrease but it’s not.
Another factor that is not helping is because USDx has lost peg, the rebases are not being called as the reward is insufficient to cover the cost of calling rebase.
While the community had good intentions to reduce IL during negative cycles, ultimately I think the proof is in the pudding and whitelisting the LP is doing more bad than good.
For all LPs worried about IL, the practical suggestion is to remove liquidity and place your USDx into xBond. The 1-1 redemption is going live so you don’t lose anything. Also LPing USDx during negative rebases doesn’t really earn any rewards so not sure why the self preservation unless it’s a sunk cost fallacy.
Ultimately there are 2 options from here
1: continue this debase whitelist LP experiment and see how far it goes (sincerely doubt a repeg without external deflation)
2: enable debase on the LP and have all LPs remove liquidity and xBond for a 1-1 redemption at a later date.
Snapshot vote: Snapshot