UST Goes Interchain: the 4pool and redacted cartel

Disclaimer – I am a member of the TFL team and this is not an april fools joke kek

As hinted in Reasonable Strats Part Five here are some measures the Terra Community should take to increase UST presence across Ethereum and other EVM chains via a collaborative, mutually beneficial, and efficient partnership with Frax Finance and Redacted Cartel.

the 4pool

Introducing the 4pool, the new gold standard for stablecoin liquidity, bridging the gap between decentralized and centralized stables. The 4pool is a new curve pool composed of UST, FRAX, USDC, and USDT. Together Terra and Frax will concentrate stablecoin liquidity across 4pools on every major chain via Curve. Initially, 4pool will be tested on Fantom, Arbitrum, and mainnet Ethereum (once a Curve fix is deployed to allow this pool to be made on Eth).

Currently, UST and FRAX directly compete against each other for CVX/CRV emissions through votium incentives and vlCVX votes while each of us subsidizes 3CRV, this war is unlikely to end given both of us have enough firepower. Instead, together, we can focus on growing the entire decentralized stablecoin pie and help create sufficient liquidity to allow the entire DeFi industry to transition to greater usage of decentralized stablecoins. Ultimately, DeFi cannot follow through with its cardinal rule of decentralization while using stablecoins that can be censored by any one entity.

Frax and Terra are the two largest protocol holders of CVX (over 3.65m CVX cumulatively) and the two largest votium incentivisoooors (7m in FXS and 4m in UST) thus together they can direct vlCVX power and votium incentives to make 4pool the most liquid and utilized stablepool across chains. Together they effectively get more liquidity per dollar spent.

The 4pool ethos is the realization that “stablecoin pegs are stronger together than competing against each other.” That’s why Terra and Frax have decided to support this new DeFi primitive on all chains through Curve Finance’s deep stableswap technology. Additionally, given the depth of resources both projects will pour into making 4pool successful, we expect 4pool staking to be a new gold standard of stablecoin yield in all chains that 4pool is found - aside from Anchor of course ;).

Additionally, given how the FRAX AMO structure works, the 4pool enables UST to become a collateral asset for FRAX further aligning interests between the projects since as FRAX grows UST grows too and vice versa.

the redacted cartel partnership: btrfly on da moon :butterfly::full_moon:

Redacted Cartel is an initiative using the POL mechanics of OlympusDAO to accumulate as much liquidity as possible from the Curve ecosystem in order to have a majority say over the Curve gauge along with other protocol governance systems. The cartel does not aim to act maliciously, rather gamify and decentralize the process of incentivizing the gauge through a DAO. Using concepts from the Olympus model, they have made a blackhole for CRV, CVX, FXS, TOKE, and gOHM.

Redacted has a treasury valued at over $100m in protocol governance tokens, you can see more details about their holdings and revenues here. Additionally, with the acquisition of Votemak, Redacted (V2) has created Hidden Hand, a generalized incentive market protocol for veTokens.

An initial Terra x Redacted partnership has been made on many fronts:

Firstly, as passed in Degen Strats Part One, the Terra Community Pool will be using Hidden Hand to secure a Tokemak Reactor in the upcoming C.o.R.E. vote. Something something Hidden Hand something something veASTRO, veANC, Rust code.

Secondly, as passed in Reasonable Strats Part Five, the first DebtDAO loan using UST will be provided to Redacted Cartel. Keep an eye out on comms from DebtDAO as to the structure of that partnership.

Lastly, and most exciting, the Terra Community pool will partner with Redacted for their vlCVX power in Convex Gauge votes given Redacted is the 3rd largest DAO holder of CVX. Redacted will vote for the UST-3CRV pool with their CVX (eventually the 4pool when launched on mainnet), claim the UST votium incentives as per usual, and be supplied with a few percent extra. Redacted will never sell the UST for another stablecoin and will use it to pay contributors, participate in seed deals, single side LP, and build up their stable treasury. This is beneficial for both parties on multiple fronts. Redacted is able to optimize their vlCVX since when delegated to Votium they receive multiple types of tokens that are not directly aligned with their mission. Whereas now they receive solely the people’s stablecoin which can be used in many ways throughout DeFi to further their goals. The Terra Community on the other hand spends approximately the same amount on vlCVX incentives and ensures the UST incentives are used meaningfully within DeFi rather than sold, bridged, or simply placed into Anchor.

These steps further increases UST presence within Ethereum DeFi and marks a glorious partnership with one of the most exciting projects within DeFi.


Something something support.


Support. Wild. Fire!

Looking fwd to this! Which bridge is able to send UST to Arbitrum?

Fukin’ A

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Too bullish, must be April Fool’s prank
or are decentralized stablecoins about to take over the EVM?

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Some of your statements seem at odds with your actions, and the statements of Do Kwon.

  1. A 4pool consisting of UST, FRAX, USDC, and USDT seems to be at odds with the statement that " we can focus on growing the entire decentralized stablecoin pie" when it excludes the longstanding decentralized stablecoin DAI from its prominence in 3pool.

  2. Does it “transition to greater usage of decentralized stablecoins” when you include the same number of centralized stablecoins as 3pool? I guess you could argue those coins are now only 50% of the pool as opposed to 2/3. But it doesn’t seem to be a step forward in moving away from those coins. Why not replace USDC or USDT with DAI? That would be a step toward reducing reliance on the centralized stablecoin that is removed.

  3. The statement of growing the decentralized stablecoin pie seems to be at odds with Do Kwon’s statement that “Goal is to starve the 3pool” and since 4pool is 3pool minus DAI plus UST and FRAX, it can only be read as “Goal is to starve DAI” which seems like the type of zero-sum PVP mentality that’s the exact opposite of your statement. How does starving a competitor grow the ecosystem?



Majority of DAI is collateralized by USDC. This makes the 3pool risk profile at least 50% USDC 33% USDT and the leftover DAI collateral.

This in turn makes it not decentralized as more than half of its collateral can be frozen by a single party.

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It seems as if excluding DAI from the 4pool begins to favor more capital efficient Stablecoins rather than decentralized Stablecoins.

I think the reason to favour Frax over DAI is because Frax is willing to use UST as collateral.
I think Frax is more centralized(Decentralization ratio = 28.58%,source ) than DAI at this point.

Ser, LFG!

What is the name of this 4-pool? Name it FUD ( Frax-UST-Dollar or FU DAI )?


when Do Kwon announced, it’s a big deal. By the rationale in this prop, it’s even a bigger deal with Redacted committing to $UST. Terra got a fantastic BD team!

If reducing USDC dependency were the goal, wouldn’t the simple solution be to remove USDC? That would also make the pool much more focused on decentralized stablecoins (up to 75% from 50%). It seems instead this is much more focused on a partnership between UST and FRAX than “greater usage of decentralized stablecoins” or even moving away from USDC.

I do agree with @0x_bear , isn’t our goal “a decentralised economy needs a decentralised currency”? If so, why are we establishing a deeper stablecoin pool with two centralised stables, USDC and USDT? Could it not be a 2pool with just UST and USDC as a base pair?

The other pools could be:

  1. 2pool-USDC
  2. 2pool-USDT
  3. 2pool-DAI

Created account on this forum to voice my genuine concern, as a new account can only share 2 links.

Haters gonna hate or a voice of reason?

Tether backing

I don’t trust USDT. You can call this behavior “Tether FUD” but I stand by it.

The settlement with NY AG: Attorney General James Ends Virtual Currency Trading Platform Bitfinex’s Illegal Activities in New York | New York State Attorney General

Bitfinex and Tether recklessly and unlawfully covered-up massive financial losses to keep their scheme going and protect their bottom lines

In order to secure criminal charges, the evidence needs to meet certain standard. Probably they had some “reasonable doubts” and reaching a settlement was the next best thing.

I always listen with curiosity to the podcasts with the CTO of Tether / Bitfinexed and the question on backing USDT is the “elephant in the room”. In the context of Evergrande and commercial paper of Chineese real-estate developers it’s unknown, uncertain.


I generally like 4pool, but UST, FRAX, USDC, DAI. Remove toxic USDT.

DAI has been around for a while, battle-tested, native to the crypto space

I can understand the distrust of USDT (I hate it too), but it has the MCAP and liquidity. It will die eventually, but not today.

As for DAI, it’s a broken and less useful version of the USDC and Eth it is backed by. Unless DAI we’re to ditch it’s USDC backing in favour of a mix of UST and FRAX, it can DIAF :slight_smile:


Thanks, @CapriciousSage . After seeing some inputs on Twitter, its evident that USDT & USDC being the highest liquidity stables still has its place , for now.

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This is such a big moment in the history of Terra. Excellent decision!

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I much prefer building the future on solid foundations.

I much prefer not perpetuating USDT.

USDT and so-called “Tether FUD” possess a systemic risk to the entire ecosystem.

DAI has survived the test of time - it has been around since 2017 and seeing ETH price from $1400 to $80.

Interesting thread below…

Why was $DAI singled out? Revenge.

EDIT / UPDATE: Or just skip DAI, I’m not religious about it. USDC UST FRAX. Without toxic Tether, that’s something I feel strongly.

Someone somewhere is likely to make money out of it, but I much prefer legitimate projects (Terra, Curve, Frax, Circle) to stay away from the drama…

So we’re just going to trust them? Hmm…