Update: Sept 9, 2021: vSPY has been settled to the now-hard-coded value of 0.13915 vSPY to ETH. 1 vSPY will be forever worth .139153818337717000 exactly. See Appendix 1 below for detailed status updates.
In order to better represent the US stock index, ItoVault is upgrading its vSPY to vVTI. vVTI is same as vSPY but instead of tracking the SPY ETF, it tracks the VTI ETF. Instead of covering just ~500 stocks, this new ETF allows us to cover around ~4000 stocks!
First, we’ll describe how to migrate the token. Then we’ll address common questions. Finally, we’ll describe the exact transition mechanism.
How to Migrate from vSPY
Want continuing exposure to the US stock market? Then migrate from vSPY to vVTI before August 27th, 2021.
- If you own vSPY, you can simply sell it (or redeem it directly for ETH at Global Settlement), and then buy vVTI. If you do this before August 27th, 2021, you’ll get continuous exposure to the US stock market.
- vVTI is already live and on Uniswap as of August 5th, 2021.
What if I have exposure to vSPY and don’t take any action at all?
- vSPY will stop tracking the SPY ETF after August 27th, 2021, and will be redeemable for a constant amount of ETH. Thus, your SPY exposure will convert automatically to ETH exposure on August 27th, 2021 with no action needed on your part.
What if I want to exit vSPY entirely?
- There are 2 redundant mechanisms for you to exit vSPY so you can be assured of the value of vSPY!
- Mechanism #1 is to directly use the VaultSystem to redeem your vSPY for ETH. All you need to do is call the settledConvertvSPYtoWei() function in Etherscan. This is a hard-coded, unremovable, function that will exist indefinitely, so there is no deadline for using this.
- Mechanism #2 is to sell your vSPY on Uniswap, for those more familiar with Uniswap. We anticipate good liquidity on Uniswap for vSPY both before and after settlement until at least October 1st, 2021. Keep in mind the vSPY price on Uniswap may make it more or less favorable to redeem directly.
Q: Can I still get exposure to the stock index after vSPY settles?
A: Yes! vVTI which is already on Uniswap provides a better exposure to stocks as it has around 4000 stocks instead of just 500.
Q: If I don’t take any action, will I lose value?
A: Your vSPY exposure converts to just ETH exposure on August 27th, 2021.
Q: Will Uniswap liquidity exist for vSPY indefinitely?
A: You can indefinitely exchange vSPY to ETH at a constant value (specifically, the value of SPY/ETH on August 27th, 2021) using the settledConvertvSPYtoWei() function. Uniswap liquidity is provided by the community and is not guaranteed to exist indefinitely, although we believe Uniswap liquidity for vSPY will be good at least until October 1st, 2021.
Q: What if I have a vSPY vault?
A: You can indefinitely convert your vault to ETH with the vSPY using the settledConvertvVaulttoWei() function. Alternatively, you can buy back vSPY to pay down the vault debt and withdraw your ETH. However, the latter method depends on liquidity of vSPY, which may not exist after October 1st, 2021.
Appendix 1: Exact Steps Taken
- This blog post is published and circulated. Feedback, if any, should be sent to email@example.com before Monday August 16th, 2021 for consideration. This has already been done and generally the community has no issues with the plan.
- The plan is considered community approved and final by August 16th, 2021. Governance guided by community will run the govStartGlobalSettlement() function around August 16th, 2021. This has been done.
- Oracle continues updating vSPY prices. Oracle updates vSPY prices one final time based on the August 27th, 2021 4PM ET stock market closing price of SPY. To be specific the close price of SPY will be the close reported by the standard exchange for 4PM. The close price of ETH will be the UTC daily close price reported on Coinmarketcap. This has been done with the final conversion rate of vSPY to ETH being exactly .139153818337717000 (this is the exact integer gwei amount)
- Governance (or anyone actually) can run the registerGloballySettled() function around August 30th or later which allows direct conversion of vSPY and vaults to ETH. Anyone can globally settle vSPY now.
- Oracle and Governance keys will be burned (i.e. set to the zero address or similar) between August 30th and October 1st. This is still TBD as of Sept 9th, 2021. This step is not critical if delayed by a few weeks since it has no functional difference as long as the governance / oracle key is safeguarded, which it has provably been for the past year.