Blue Chip Token Index Proposal

#1

Blue Chip Large Cap Tokens
This category tracks Ethereum-based blue chip tokens, including DeFi governance tokens, wrapped blockchain currencies and stablecoins.

Name: Blue Chip

Symbol: Blue

Criteria

  • This category has the following criteria for inclusion:

  • The token is at least 12 weeks old.

  • No major vulnerabilities have been discovered in the token contract.

  • The token’s supply can not be arbitrarily inflated or deflated maliciously.

  • wETH and wBTC supplies will be hard set to allow for proper representation. 21m and 110m respectively, this also addresses supply manipulation concerns.

  • The control model should be considered if the supply can be modified through governance decisions.

  • The token does not have transfer fees or other non-standard balance updates.

  • The token meets the requirements of the ERC20 standard.

  • Boolean return values are not required.

  • The token has a fully diluted market cap of at least $1 billion.

  • At least $10m worth of liquidity is locked in the Uniswap market pair between the token and WETH or approved stablecoins.

  • Where centralized Cryptos are included, public and transparent audits for the underlying assets must be available as well as proofs for reserves.

  • The token is one of:

Protocol token for an Ethereum-based project.

Governance token for a DeFi project.

Wrapper token for a blockchain’s native currency.

Stablecoin

Terms
Fully Diluted Market Cap: Market price of one token in USD multiplied by the token’s total supply.

Protocol Token: A token used for some core aspect of a system, such as payment for services within a protocol or rewarding users maintaining a network.

Governance Token: A token used to vote on governance decisions for a project.

DeFi: Decentralized Finance - used in reference to Ethereum-based financial projects. By “financial projects” we mean projects which directly deal with finance such as exchange, lending, portfolio management, derivatives, etc. and not projects which are only peripherally related to finance.

Index Naming Scheme
Indices deployed for this category should use the following naming scheme for the ERC20 name and symbol:

Symbol: Blue + Index Size

Name: Blue Chip Top + Index Size + Tokens Index

Example

Index Size: 5

Symbol: Blue5

Name: Blue Chip Top 5 Tokens Index

Swap fee set to .002x the transaction amount to increase volume and fees.

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#2

This proposals being made due to the risk that centralized tokens create to our CC10 index but to allow for exposure to the top assets in Crypto including a stablecoin hedge. These assets are Blue Chip as they are assets that are the largest, most reliable and most popular in the space and so an index for them will be key. A stablecoin hedge has been included for downside volatility management, growing as non stablecoin assets value drops, creating higher weight and dropping when Crypto runs. Fixed supply targets for wETH and wBTC to be representative

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#3

I like the idea of a blue chip index to avoid concerns with centralization in CC10, and I think adding stablecoins for stability is a good idea. As we discussed privately, the ability to set an override for a token supply may be a good way to get around the issues with weth/wbtc having somewhat arbitrary market caps. This could be added to the current controller, but due to the inheritance structure may present some difficulties in a proxy update.

I would like to see some more feedback on this idea, including input from the community on the criteria used for selection. Even with the very high market cap and liquidity requirements, we may still want to be somewhat selective with which assets we consider blue chip.

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#4

As requested according to current reqs current blue5 would contain

wBTC
wETH
USDc
Link
Snx

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#5

I like the idea, cant wait to see it listed. pure market caps would be something like wBTC, wETH, USDc, LINK, AAVE

#6

I’m not convinced about the need for a stablecoin presence to hedge against volatility here, but I can see the reasoning. There’s a debate to be had about whether an index should even attempt to provide downside protection, but if push came to shove, it’s not a hill I’d be willing to die on.

#7

Not gonna write much, but I like the idea to push this through in a pretty quick manner. I would also love to see some a high growth index to sort of diversify, as I think would be beneficial to Indexed

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#8

Was just a thought as haven’t seen any that actually propose this and would help dampen volatility, create safety during bear markets as stablecoins grow into and out from the index as they have done and allow for some ability to buy during drops sell during runs (cause higher Crypto weight will cause USDc to drop and so assets flow to the run).

#9

My main concern is using fully diluted market cap as a means of measuring value. I imagine it would probably be pretty easy to get shitcoins or coins with poor tokenomics and token distribution included in to the indices. Granted 1bil is a pretty high require evaluation so perhaps this isn’t really a concern.

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#10

That would probably fall under the malicious supply crit. Also because the new controller allows the DAO to set supply where totalsupplys bad, they can do that to any token being fucky

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#11

I would do wBTC, wETH, Link, Uni, (SNX,MAKER, or COMP) these are the largest market cap erc20 tokens which are not stable coins and have a large userbase and backing. They also provide great products that will likely survive bear markets unlike many other projects.

#12

USDC is an interesting idea to dampen volatility but I fear it will lead people away because most look for solid returns with an index and hedge their portfolios elsewhere. I think it would make sense to replace with the next biggest erc-20, UNI.

Seems AAVE/SNX would be neck-to-neck considering fully diluted marketcap… perhaps AAVE’s larger current market cap should give it the lead

#13

They’ll survive but drop .8x. Stablecoins would help that volatility. While getting smaller allocation during bull runs

#14

the proposed index sounds more like a ai/quant active traded fund if usdc is included aka. seems to be trying to time the markets for highest profits in this case. am in agreement that downside protection in terms of the dollar value counterpart is probably not required in an ETF.

further, if the smart contract parameters for downside protection is actually visible, correct me if im wrong or misunderstanding, but would this not open avenues to potential abuse once the index has a substantial amount of value locked in as well?

#15

Nah you wouldn’t because would just be an asset in the pool, wouldn’t sell all assets or try fuck with balances other than by the weights just updating, going higher as Crypto goes down or lower as Crypto goes up as USD / Crypto would counter to Crypto going up or down.

#16

Bumping this because would be great to see an index with wBTC and wETH, with a stablecoin to generate high fee rev. By offering an index which by nature has high liquidity with a stablecoin eth/btc pair we may be able to be the cheapest exchange for these assets and generate high fee revenue by lowering the swap fee.

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#17

I feel like having a CC10 and a Blue Chip doesn’t really make sense, isn’t CC10 supposed to be the top 10 cryptocurrencies, wouldn’t it make more sense to add wBTC and wETH to the CC10 index instead of adding a whole new index?

I feel like CC10 is getting sidelined here when it should be Indexed’s top offering. It also really doesn’t help that DEFI5 is comprised entirely of tokens found within CC10 as well. In the future I would really like to see the token pools of CC10 and DEFI5 add and remove tokens from the available pool more frequently.

#18

Yeah it should but there are some technical reasons we cant just integrate. We are exploring deprecating the current cc pool and going to a v2 that can support them much easier. Wrapped tokens become hard because the onchain supply can be manipulated so we need to use oracles.

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