**Quick Dive into Resupply**

* Resupply is designed to be a yield farming and revenue generation monster. RSUP is the governance token and reUSD is minted from CDPs.
* **Capital Efficiency** is the name of the game here, and with Resupply, there are a multitude of ways. Here are some highlights:
* Key to the novel Resupply mechanism is that the borrow rate for reUSD will be set at half the lending fee rate. Here is one example of a **leveraged loop**:
* Example: You supply crvUSD on Resupply.
* The Lending Rate is 10%. Therefore, Borrow Rate is 5% (10%/2). With 20x leverage, 20 *5% = 100% APR in stables.
* But that's not all, because all crvUSD positions will be staked on Convex, they will earn CRV/CVX rewards as well. If we assume CRV apr to be 5%, with that 20x leverage, this will be another 100% APR ***for a total of 200%!!***
* As far as I am aware, this will all be seamless with one click!
* Leverage is a feature! Here are some key precautions undertaken:
* Insurance Pool. reUSD can be deposited to a vault to insure the protocol against bad debt as well as CDP liquidation events. Depositors will receive revshare as well as RSUP tokens.
* Half of the RSUP token supply will be directed to Voting Incentives to incentivize liquidity.
* Redemption model.
* Although leveraged loops will likely be the main attraction, Resupply offers something for everyone.
* For simple lending, Resupply can unlock your capital.
* For example, you have 100,000 crvUSD. You deposit that 100k crvUSD into Resupply. Resupply deposits that into your chosen lending pool, let's say that is the sDOLA. You mint 95k reUSD. With Resupply's ***predictable rates and modest fees***, you can easily manage your position and even unwind if need be without being taken to the cleaners.
* Overall, because you are borrowing stables against stables and because your borrow rate should not exceed what your collateral is making (since the borrow is set to half the lending free rate), ***it is very unlikely you will be liquidated*** while using Resupply.

**What Does Resupply Mean for Convex?**

* Recap
* veCRV = dex + crvUSD fees; which flows to cvxCRV
* vlCVX gets Voting Incentives w/ a 16 week lock
* Resupply will *turbocharge* Convex; here are some highlights:
* the 1% Team Vesting suggests only necessary development expenses; devs are true altruists here, literally gifting the rest of the upside to us!
* Convex will have majority control of Resupply and majority share of $RSUP revenue. Convex and Yearn vests will be perpetually staked.
* $RSUP revenue will flow back to vlCVX and to Convex Treasury
* dedicated $RSUP emissions for Voting Incentives which means $/vlCVX will go up.
* there is NO maximum supply for RSUP; starting Year 6 there is a set inflation rate of 2%. This is an extremely bullish and thoughtful design for long term sustainability.
* new partnership model moving forward: SubDaos.
* Instead of the cvxXXX wrappers we have come to know, Convex will now have SubDaos. Resupply is the first such example! The value from SubDaos will continue to flow back to vlCVX with zero distraction/metagaming!
* Resupply is a crvUSD sink, driving crvUSD demand and will thereby increase crvUSD fees. These fees will increase the apy of cvxCRV allowing arbs to the upside and closing the discount.
* Beyond Curve and Llamalend, the battletested Fraxlend could always use some more capital effiency (Resupply!), and we currently control around 38% of veFRAX. Rising tide!