PIP 32: PieDAO Balanced Crypto Pie

Following up from community discussions over the last couple weeks, I’d like to offer a proposal for a PieDAO Balanced Crypto Pie ($BCP), representing the broadest asset allocation available in any single token on the market.

The proposed Balanced Crypto Pie at launch would include the following allocation:

  • Wrapped Bitcoin ($WBTC): 33.33%
  • Ethereum ($ETH): 33.33%
  • PieDAO DeFi++ Index ($DEFI++): 33.34%

Note 1: This approach would automatically include a broader DeFi allocation if and when the PieDAO DeFi++ Index is adjusted, such as to include MicroCaps along with the current LargeCaps and SmallCaps

Note 2: This approach is also flexible enough to include additional components if and when the community decides to add them, such as single tokens like $PAXG or other PieDao pies like a PieDAO Data Economy index.

Pie components and weights will ultimately be defined as per PieDAO governance in order to factor in the overall market output and best achieve this Pie’s objective.

Below is a summary of the proposed starting allocations for the PieDAO Balanced Crypto Pie:


Below is the backtest performance for the proposed Pie from October 3, 2020, the first day when all underlying tokens were available, through November 18, 2020.

You can find the full spreadsheet here.

Credit to @MoolaManX for the proposed allocations (1/3 each), @alexintosh for the name, @gabo for the spreadsheet & proposal format, and @chris @mickdegraaf @williambrealey1 and others for feedback & discussion.

8 Likes

I love this Pie. The one question I have is why don’t we include BTC++ in the allocation in the place of the WBTC? Is this for liquidity purposes? Other than that I think this should be the next Pie to launch. If this pie goes live I think it would be worth a nudge to get our friend Chico Crypto to do a segment promoting it!

5 Likes

Great pie, this is something I can give to my family during Christmas.

I think we have to use WETH instead of ETH to make it ERC20 compatible. And minor detail, ‘Ethereum’ should be ‘Ether’. As you are referring to the currency.

3 Likes

Good points @evert0x.

@MoolaManX I had the same thought, but @alexintosh convinced me that WBTC offers benefits in liquidity & simplicity for now. I think WBTC makes sense for now, and I hope we see enough interest in BTC++ to switch in the future.

4 Likes

From a scalability prospective BTC++ might be a bottleneck, we can swap it in the future if needed.

2 Likes

Great proposal! I do agree that BTC++ could in the near future be a preferable option vs BTC, but in its current form would likely represent a bottleneck.

I’d proceed with this Pie asap, given the new downward momentum of Defi vs ETH.

2 Likes

IMO it would be nice to give maybe 10% allocation to a USD as well, maybe a yielding equivalent like yUSD. This would create USD trading liquidity for DEFI++, and also dampen volatility a little bit vs an all crypto index. Might be more normie friendly.

2 Likes

@monet-supply I originally thought the same, but got some great feedback from the community:

  1. Balancer pools perform better with correlated assets under their continuous rebalancing scheme
  2. Many crypto investors hold their USD in actual USD; stablecoin holdings are for some utility like lending, etc., not for investing. For that use case, $BCP + actual USD is a better fit than a $BCP that includes USD
  3. If the community decides, we could see $BCP rolled up into a new multi-asset class “All Weather Pie” that includes USD, just as $DEFI++ is rolled into $BCP. This was proposed as PIP3 and I think we’ve been incrementally building towards this.
3 Likes

I am excited to see this Pie implemented. It would be great.

2 Likes

why not use BTC++ instead of WBTC?

3 Likes

See my comment above, the short answer is: BTC++ is not liquid enough to make this Pie scale at the moment.

2 Likes

Signaling Vote live on Snapshot, 24H.

1 Like

Having trouble voting on Argent. Wallet says signiture doesn’t match.

Love this proposal, where can I stay up to date when the New pie, launches here?

1 Like

Same question. Were there any updates on this?

1 Like

@I3eb0p. I think so : https://t.co/siokA2IPvP?amp=1

1 Like

Hello everyone,
I’m interested in BCP but am new to crypto. Would someone explain the process from me swapping my eth for BCP. Assuming profits were made how do I receive them? Do I convert my BCP back into eth at the end? Just a little confused on all that.

great idea

1 Like