1,000,000 HOLLAR and borrow 1,350,000 PRIME for the Decentral USDC poolThis referendum repays 1,000,000 HOLLAR of the Treasury's money-market debt, borrows 1,350,000 PRIME against the Treasury's collateral and moves that PRIME to the Treasury's pure proxy account 15qyoAjtLwtu7stVJ5qdsj7QJsfaxQEU3ZrihHExzC6hQyHA. That account already holds 592,529 PRIME (about $632,000 at the current $1.067 oracle price) belonging to the Treasury, supplied to the money market as aPRIME after the recent unwind of the PRIME loop. Together with the new borrow it will hold about 1,942,500 PRIME, roughly $2.07M.
An on-chain remark instructs the council multisig 16RJh4z1eUHpC3ntre9H2noKGKxihkSqog9PBt9bRbAnj4RE, which holds an Any proxy on that account, to convert the PRIME into 2,000,000 USDC (Wormhole) via DCA and OTC and deposit the USDC into Decentral's new USDC pool 0x0AAF753018465Cd26758F1163f63469061074676. Treasurer track.
Decentral has opened a new USDC pool on Hydration specifically for this Treasury deposit, and this proposal places $2,000,000 of Treasury capital into it. The terms of the pool: deposit of 2,000,000 USDC (Wormhole), fixed 15% APR, 90-day minimum term, yield paid in 90-day cycles, 30 days' notice for withdrawals.
The position sits outside BIL and does not use HOLLAR, so it adds no strain to the HOLLAR peg. The yield is paid in Ethereum-native USDC and can be directed to protocol needs in the same way as Hydrated Strategy part 3: accumulating protocol-owned liquidity in desirable assets and supporting the HOLLAR peg.
The capital comes from PRIME that is otherwise idle: the 592,529 PRIME left in the pure proxy after the loop was unwound, plus 1,350,000 PRIME newly borrowed by this referendum. The Treasury borrows PRIME at a relatively fixed, low rate and places it at a fixed 15% APR, keeping the spread for the protocol.
The cost of the borrow has two parts: the money-market borrow rate, which will be 0.94% APR after this referendum executes, and the PRIME yield of 6.3% per year, which accrues to the debt because PRIME appreciates in price. All-in the borrow costs 7.24% per year on 1,350,000 PRIME (about $1,440,000 at $1.067), or about $104,000 per year: $13,500 of interest and $90,700 of PRIME appreciation on the debt.
The deposit earns a fixed 15% APR on 2,000,000 USDC, or $300,000 per year, paid in 90-day cycles. Net of the borrow cost the position is expected to earn the protocol about $196,000 per year.
The position also acts as a partial hedge for the protocol's PRIME exposure. PRIME will initially be the source of yield for Juicer, so converting part of the Treasury's PRIME into a fixed USDC income stream reduces how much of the protocol's return depends on PRIME alone.
1,000,000 HOLLAR of variable debt, borrow 1,350,000 PRIME at the variable rate, and transfer the 1,350,000 PRIME to the pure proxy 15qyoAjtLwtu7stVJ5qdsj7QJsfaxQEU3ZrihHExzC6hQyHA. These three steps are wrapped so that they either all execute or all roll back.Both steps execute as the Treasury account, which is why this runs on the Treasurer track.
The Treasury's HOLLAR debt falls from 1,266,318 to 266,318 HOLLAR and its PRIME debt rises from 1,155,317 to 2,505,317 PRIME, within the 3,000,000 PRIME borrow cap. The Treasury's money-market health factor moves from 2.08 to 1.79. The pure proxy receives 1,350,000 PRIME (about $1.44M) on top of the 592,529 PRIME it already holds as aPRIME with no debt against it, for a total of about 1,942,500 PRIME (about $2.07M), which the multisig withdraws and converts to reach the 2,000,000 USDC target. Any PRIME left after the target is reached returns to the main Treasury account to repay the borrow. No user position, reward claim or other market parameter is affected.
The full call was executed end-to-end on a fork of mainnet at block 16,331,635 under the Treasurer origin: every inner dispatch returned Ok, no EVM call failed, the Treasury's HOLLAR and PRIME debt changed as stated, the pure proxy's PRIME balance rose by 1,350,000 and the remark was emitted by the Treasury account. The same call was also dry-run against the live runtime at block 16,331,764. The pure proxy's existing 592,529 aPRIME balance was read at block 16,336,243.
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Track: Treasurer
1,000,000 HOLLAR of debt and borrows 1,350,000 PRIME.592,529 PRIME.1,942,500 PRIME (about $2.07M).2,000,000 USDC and deposit it into Decentral's new USDC pool.15% APR for at least 90 days.90 days, in Ethereum USDC.7.24% per year, or about $104,000 per year.$300,000 per year.$196,000 per year.1,266,318 to 266,318.1,155,317 to 2,505,317 (under the 3,000,000 cap).2.08 to 1.79.