Transcript of the Ampleforth office hours on 20.10.2021

6 min readOct 21, 2021

Question 1:
Is the geyser ( APY displaying correctly after the topup?

I doubled check the math. I think it’s accurate. I’ve added a ui fix to show the deposit value so you can quickly check inflow vs outflow.

Follow-up question:
Okay so the issue is that on my screen the multiplier is x1 then. I’m not staked in it, so default multiplier, but it’s factoring in other participants having mature multiplier already then?

Yea. It does factor in you existing deposits. I think alchemist might be overestimating the APY in their implementation ..

Question 2:
Saw the Avalanche bridge went live last night, are there any projects building with AMPL there?

We’ve been in contact with Trader Joe, Pangolin, and Benqi — all great folks! Kinda feels like a more finance-forward community that Ethereum.

and Avalanche of course.

Question 3:
Now that AMPL is positive rebasing any plans to launch some liquidity pools? Was that what we saw with AVAX?

Some of the folks we’re launching with re:AVAX will have built in incentive programs!

Question 4:
When will Aave show correct APY %?

Hard to say. I would have thought that they would’ve addressed this way sooner. Quoting incorrect %-es seems like a big deal to me since it’s core to their market functioning. That said, I think they are working on a new version of the UI, so maybe it’s already handled there?

Question 5:
I didn’t see an AMPL building workshop on the chainlink hackathon schedule. When is that going to be?

Right now it’s scheduled for Oct 26th at 10am PT! This scheduling is pretty recent though, so don’t know for sure whether it’ll get rescheduled between then and now.

Question 6:
How does the workshop work exactly? Do people have a chat with you and share with you ideas or share the creations they’ve made with Ampleforth?

That’s a good question, actually. I’m still waiting to hear back more on the details. I’m assuming a presentation format over video, 1hr. Hopefully there’ll be a lot of space for questions too. We’ll also have a dedicated ongoing discord channel for hackers.

Question 7:
Any thoughts on how Aave has been performing? Seems like price has stickied around the target after the interest rate change, which is great. We’re still at pretty high utilization (>95%) now during these positive rebases. Do we think interest rates need to be adjusted still or do we need more time here to observe?

I’d still like to see more lenders coming in. APY is pretty high and there are additional incentives from Splendid which are substantial. The aAMPL deposits haven’t increased much.

I expected at least 4–5M in deposits given the reward amount (looking at other pools/geysers) ..

Speculating here reasons could be:
1) People don’t understand risk/reward of aAMPL yet
2) Aave APY is misleading
3) People don’t know splendid exists

Looking back one of the reasons the first generation geysers were so successful was because we attracted thousands of users. At the all time high we had over 12k depositors. A lot of these people never used Metamask or Uniswap before. Geysers introduced them to DeFi.

I haven’t pulled the exact numbers but my guess is the number of depositors now is far far lower and the major reason is gas costs are prohibitive.

Question 8:
Very long term question — in a hypothetical world where 1 AMPL is the traded value of 1 AMPL, what would it rebase against? The dollar becoming irrelevant, essentially.

Yeah great question. I like to say that the AMPL price target is independent of any other currency, even the dollar. The AMPL target points to a particular “purchasing power” that happens (for simplicity) to be what $1 had in 2019. We could also just as easily have said that the targets was 0.9 2019 Euros, or 1 gram of aluminum at that time.

So it’s already disconnected from the dollar. Instead, it’s best to think of it as a measurement problem. How’s the best way to measure the current-day denomination of this particular purchasing power? Right now we use PCE, but could be switched to other metrics in the future through governance if needed.

Question 9:
So when do we get AMPL on Avax Aave?

I think we’ll definitely move some geysers, if not all over to cheaper l2s. It’s still a quarter or two away ..

Question 10:
Would the team ever consider lender or borrower rewards on Aave? Fei is currently doing this for Tribe borrowers.

There’s “off-Aave” rewards for depositors through the geyser. It’s interesting to think about incentives for borrowers, but I’m not sure I’m really sold on it yet myself.

One thing that’s certain is that rewards dictate behaviour. Incentivising deposits adds liquidity to the market. Incentivising borrows… ? Organic borrow activity is great, for sure. Inorganic borrow activity might make a good vanity metric, but I’d want a good explanation for how it helps the network before putting capital behind it.

Follow-up thoughts:
Borrowing is essentially taking a short position on AMPL. Trying to give shorters long exposure (through the geyser) is weird.

I do want to say that there can be many reasons to borrow. Not every borrow is what you’d call a “short”. Someone might legitimately short, by borrowing, selling, waiting for price to decrease, rebuy, and repay.

Someone might borrow to go long. But more importantly, long term we do want people to borrow AMPL and “put it to work”. Is borrowing USDC to buy ETH shorting USDC? Not necessarily (at least by mindset). That’s just a healthy use of the USDC asset.

Question 11:
How about increasing the geyser rewards even further for lenders to compensate for the expected rapid growth of AMPL?

Don’t forget how supply expansion works. If supply expands, all wallets, including the wallets that have the geyser rewards in them expand.

The opposite is true as well.

So if AMPL supply expands, the # of AMPL in the geyser rewards pool expands as well. If AMPL supply contracts the # of AMPL in the geyser rewards contracts as well.

Question 12:
What do you guys think about the state of L2s generally speaking? Security concerns? Decentralization concerns? Are zk-rollups or whatever just going to obsolete the current scene in a year and does that even matter? Any other things about them you find interesting etc. any reasons you’d want to avoid deploying on them for now?

It’s really hard to see the future of the L1/L2 landscape. Especially L2s since these are developing so fast. The biggest disruption events will be sharding on ETH L1, and zk-style rollups, I think.

Any reasons to avoid deploying on them? Aside from the obvious per-platform security risks, there’s a cost to maintain these. Also once we deploy it’s hard to “un-deploy” since we’d need to somehow notify all users to move their assets off. So we want to pick platforms with staying power.

There are many considerations. Security is the top one. As the AMPL on these L2s aren’t pure AMPL but rather “bridge-secured” AMPL ..

The ecosystem is fast evolving and still being built out. Another consideration is just the infrastructure and development on the L2.

For example to run a geyser we’d want the underlying protocols like Uniswap, Balancer and Aave to already exist on the L2. We also want basic developer support like subgraph, block explorer contract verification etc). Arbitrum and Matic are the top 2 which have most of these things.

Lastly we want AMPL to exist there which requires some custom contracts which talk to their bridge.(we have this for Matic and Arbitrum is in the works).

We’re also keenly watching the space to see what’s next. Once the zk-L2 is up and running I want to deploy AMPL there as well.

Question 13:
Is there going to be an announcement for Avax or should we just assume it’s ready to use? Some tg folks pointed out no announcement.

New Layer-1s don’t happen all that often, so when they do we want to get the most from it.

Question 14:
Do you have any ideas for a use case of the currently orphaned AMPL sitting on the BSC chain? I think the initial idea to integrate with a lending market in BSC wasn’t all that bad.

Possibly… I think the more a reputable DeFi system develops there, the more it makes sense to invest time and energy there.

Question 15:
Does the Pescadero geyser still give out SUSHI rewards?

Not currently. This would need to go through Sushi’s governance

Link to the start of the office hours on Discord