I find the current situation that we are facing is very interesting. the following are my thoughts on the peg problem and some potential solutions. no idea if it could work, I am just a pleb that trying to offer my point of view ; )
there are two kinds of buying and selling pressure on the current market:
in a protocol like Synthetix, they separate the constant demand and temporary demand by adding a middle man: susd.
people deposit SNX and Lend susd, then use susd to open positions. the arbitrage of susd consumed the constant demand in normal days.
one potential solution for us is that we could allow users to redeem collateral at the oracle piece. this will give people the ability to instant arbitrage the market price and close their vault. in this way, the arbitrager will consume Tcap demand. and the speculator can open a short or long position without worrying about the potential difference between the market price and the oracle piece. the negative part is that the value of Tcap will be extracted out of the system.
another solution is that we could exclusively allow the protocol to do the arbitrage and use the profit to build a protocol vault. This vault could pay people to use the protocol, instead of charging them ( the competition is very high for lending and derivative protocols in Defi, we need incentives for people to use new Proucts )
in this way, we build a positive loop. the protocol generates profit from People who want to use the product (in this case Tcap holder). and use this profit to build more product ( in this case encourage people to open short or long positions, it could also be used for the team to design other derivatives ).
