GEB Docs
  • Introduction to GEB
  • Community Resources
  • FLX Mechanics
  • FAQ
  • RAI
    • RAI Use-Cases
    • Multi-chain RAI
    • RAI Integrations
  • The Money God League
    • Intro to The League
  • Ungovernance
    • Governance Minimization Guide
  • Risk
    • GEB Risks
    • PID Failure Modes & Responses
  • Incentives
    • RAI Uniswap V2 Mint + LP Incentives Program
    • RAI Uniswap V3 Mint + LP Incentives Program (Inactive)
    • FLX Staking
    • RAI / ETH Uniswap V3 Oracle LP Incentives Program
  • Contract Variables Translation
    • Core Contracts Naming Transition
    • Governance Contracts Naming Transition
    • SAFE Management Contract Naming Transition
  • System Contracts
    • Core Module
      • SAFE Engine
      • Liquidation Engine
      • Accounting Engine
    • Auction Module
      • English Collateral Auction House
      • Fixed Discount Collateral Auction House
      • Increasing Discount Collateral Auction House
      • Debt Auction House
      • Surplus Auction House
    • Oracle Module
      • Oracle Relayer
      • Medianizer
        • DSValue
        • Governance Led Median
        • Chainlink Median
        • Uniswap V2 Median
      • FSM
        • Oracle Security Module
        • Dampened Security Module
        • FSM Governance Interface
    • Token Module
      • Token Adapters
      • System Coin
      • Protocol Token
      • Protocol Token Authority
      • Protocol Token Printing Permissions
    • Money Market Module
      • Tax Collector
    • Sustainability Module
      • Stability Fee Treasury
      • FSM Wrapper
      • Increasing Treasury Reimbursement
      • Mandatory Fixed Treasury Reimbursement
      • Increasing Reward Relayer
    • Automation Module
      • Collateral Auction Throttler
      • Single Spot Debt Ceiling Setter
      • ESM Threshold Setter
    • Governance Module
      • DSPause
    • Shutdown Module
      • Global Settlement
      • ESM
  • Proxy Infrastructure
    • DSProxy
    • Proxy Registry
  • Helper Contracts
    • SAFE Manager
  • GEB.js
    • Getting Started
    • Global Settlement Guide
    • API Reference
      • Geb
      • Safe
      • Proxy Actions
      • Geb Admin
  • APIs
    • API Endpoints
  • Pyflex
    • Getting Started
      • Configuration
      • GEB Basics
    • SAFE Management
      • Opening a SAFE
      • Closing a SAFE
    • Numerics
  • Keepers
    • Keeper Overview
    • Collateral Auction Keeper
      • Running in Docker
      • Running on a Host
      • Liquidations & Collateral Auctions
      • Collateral Auction Flash Swaps
    • Debt Auction Keeper
      • Running in Docker
      • Running on a Host
    • Staked Token Auction Keeper
      • Running in Docker
      • Running on a Host
    • Surplus Auction Keeper
      • Running in Docker
      • Running on a Host
    • Bidding Models
  • Liquidation Protection
    • SAFE Protection
    • Liquidation Protection Guide
    • Uni-V2 RAI/ETH Savior Details
    • Curve V1 Savior Details
Powered by GitBook
On this page
  • Unique Money Markets
  • Stacked Funding Rates
  • Options
  • Pegged Coins/Synthetic Assets
  • Yield Aggregator
  • Sophisticated Arbitrageurs
  • Portfolio Management Strategies

Was this helpful?

  1. RAI

RAI Use-Cases

An incomplete list of things you can build with or on top of RAI

PreviousFAQNextMulti-chain RAI

Last updated 4 years ago

Was this helpful?

Unique Money Markets

If Alice pays 5% per year to borrow RAI from a money market and the RAI redemption rate is -10% per year, she is effectively earning 5% year. This is because of the expectation that RAI's market price will go down by 10% in one year. On the other hand, Bob might be lending RAI at 4% per year, but if the redemption rate is -10%, his net rate is -6%. There's the other scenario where Bob is lending RAI at 4% per year and the redemption rate is 10% per year. In total, Bob is earning 14% annually on his position (assuming that RAI will appreciate in value by 10% in the next year). Meanwhile, Alice, who's borrowing RAI at 5% per year, is paying a total of 15% (5% as the money market borrow rate plus the expected 10% appreciation in RAI's price over one year).

Stacked Funding Rates

If an exchange or protocol decides to offer RAI perpetuals, they will essentially allow traders to stack funding rates on top of each other. The redemption rate is similar but not identical to a funding rate. The net funding rate on a RAI perpetual is a combination of the funding rate on the platform/exchange that lists the perpetual and the redemption rate. RAI is the first asset ever created that allows this.

Options

A developer can build an options protocol which takes into account changes in the redemption rate in order to determine the price of puts/calls. This is because the redemption rate can be thought of as an intrinsic interest rate for RAI.

Pegged Coins/Synthetic Assets

Projects building pegged coins can use RAI as a more stable alternative to ETH. In case of a severe ETH market crash, RAI can offer its holders more time to unwind their positions before they get liquidated.

Yield Aggregator

Protocols that deploy capital in order to get the best yield for their users (e.g ) can leverage RAI (and its intrinsic redemption rate) to boost returns. For example, combining RAI's positive redemption rate with lending on or is one possible way to optimize earnings.

Sophisticated Arbitrageurs

Arbitrageurs (or otherwise traders in general) can look at the redemption price behavior and combine this datapoint with others (e.g market sentiment) in order to find the ideal time when they should execute a trade.

Some arbers can offer specialized RAI trading services to pools of capital. They can be allowed to flashloan funds and split the profit with the pool.

Portfolio Management Strategies

Anyone can create sets or pools that offer diversified exposure to RAI's redemption rate as well as other yield bearing assets (e.g cTokens, aTokens).

Yearn
Compound
Aave
Set Protocol
Balancer