The Polygon community is discussing a proposal aimed at generating additional revenue by utilizing over 1 billion dollars in funds from the PoS Chain cross-chain bridge (connecting the Polygon network with Ethereum's official cross-chain bridge).
Web3 risk management provider Allez Labs, in collaboration with decentralized finance (DeFi) protocols Morpho and Yearn, has co-authored a 'Polygon Improvement Proposal Draft' to seek the Polygon community's opinions on how to deploy approximately 1.3 billion dollars in stablecoin reserves (DAI, USDC, and USDT).
The proposal indicates that the idle reserve of 1.3 billion dollars in stablecoins incurs an opportunity cost of approximately 70 million dollars each year. Therefore, its goal is to utilize this idle capital to improve the efficiency of fund utilization and promote economic activity or user participation in the Polygon PoS network and the broader AggLayer ecosystem.
According to the proposal, these stablecoin reserves will be gradually deployed into ERC-4626 vaults targeted at each type of asset. Among them, it is suggested that the DAI reserves be stored in Maker's sUSDS vault, while USDC and USDT will primarily utilize Morpho Vaults as a source of yield. According to the proposal, these vaults will be managed for risk by Allez.
The proposal is still in its early stages and must await discussions in the community forum as well as by the 'Protocol Governance Committee' specifically established by Polygon.
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