[RFC] Migrate LCAP away from Universal Assets

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Summary

This RFC proposes migrating the CF Large Cap Index DTF (LCAP) away from Universal-issued assets while preserving its underlying crypto exposures wherever suitable replacements are available:

  • Replace uXRP with cbXRP
  • Replace uSOL with SOL on Base
  • Replace uDOGE with cbDOGE
  • Replace uADA with cbADA
  • Remove uXLM, for which no suitable replacement has been identified on Base

The proposal would retain cbBTC, WETH, and HYPE, and proportionally redistribute the reference index allocation for XLM across the remaining constituents.

Motivation

On September 18, 2026, Universal announced that it would wind down its protocol after a 60-day transition period, ending November 17, 2026. Universal states that uAssets remain backed by their underlying assets and existing infrastructure remains operational during that period, although direct redemptions may take longer than usual.[1]

After November 17, remaining uAssets are planned to become redeemable through a smart contract. Universal currently plans to support redemption of uXRP, uSOL, uDOGE, and uADA on Base into cbXRP, SOL on Base, cbDOGE, and cbADA respectively. Other uAssets, including uXLM, are planned to be redeemable for USDC. These plans remain subject to change.[1]

This RFC recommends completing LCAP’s migration before the wind-down rather than relying on the future redemption process. The objective is to preserve LCAP’s intended crypto exposures and avoid leaving the basket dependent on infrastructure being retired.

No suitable XLM replacement has been identified on Base in the migration planning. Removing XLM is therefore proposed as a limited exception to index replication, rather than retaining uXLM through the wind-down or substituting an unsuitable asset.

Proposed changes

Replace the supported Universal assets

Rebalance out of the following Universal-issued tokens and into their corresponding non-Universal representations:

  • XRP:​ uXRP → Coinbase Wrapped XRP (cbXRP)
  • Solana:​ uSOL → SOL on Base
  • Dogecoin:​ uDOGE → Coinbase Wrapped DOGE (cbDOGE)
  • Cardano:​ uADA → Coinbase Wrapped ADA (cbADA)

These replacements match the corresponding Base redemption assets currently identified in Universal’s wind-down notice.[1]

Remove uXLM and renormalize the basket

Remove Stellar (Universal) (uXLM)​ without adding a direct replacement. Its Base token address is:

0x378c326A472915d38b2D8D41e1345987835FaB64[2]

Use the applicable reference index composition at proposal preparation, exclude XLM, and proportionally renormalize the remaining constituent weights to 100%. Preserve the relative allocations of those remaining constituents; the wrapper substitutions should not introduce additional discretionary changes to asset exposure.

The proposed resulting basket is:

  • cbBTC
  • WETH
  • cbXRP
  • SOL on Base
  • cbDOGE
  • cbADA
  • HYPE

The exact target weights and verified replacement-token addresses should be published with the executable governance proposal.

Risks and considerations

  • Index tracking:​ LCAP’s stated mandate is to track the CF Large Cap Index (Diversified Weight).[2] Excluding XLM would introduce a deviation from the reference index when XLM is a constituent. The treatment should be confirmed with the index provider and relevant licensing parties before execution.

- Custody and bridge dependencies:​ Replacing Universal assets changes the infrastructure used to represent the underlying cryptocurrencies. The replacement contracts and their custody, bridging, and redemption mechanics should be reviewed before submission.

  • Execution and liquidity:​ Auction parameters and replacement-asset liquidity should be arranged to limit slippage. A token’s availability does not necessarily mean sufficient liquidity exists for the rebalance.
  • Future XLM support:​ XLM could be reconsidered through a subsequent proposal if a suitable representation becomes available.

Specification

If approved, the executable proposal should:

  1. Replace uXRP, uSOL, uDOGE, and uADA with cbXRP, SOL on Base, cbDOGE, and cbADA respectively.
  2. Remove uXLM without adding a direct replacement.
  3. Set the remaining constituent weights using the applicable reference index composition, excluding XLM and renormalizing to 100%.
  4. Execute the rebalance through LCAP’s governance and auction process, targeting completion before November 17, 2026.

This is a basket migration proposal, not a proposal to deprecate LCAP.​

Should LCAP migrate away from Universal assets using the proposed replacements and remove uXLM?​
  • Yes - approve the proposed migration
  • No - do not approve the proposed migration
  • Abstain
0 voters

Sources

[1] Universal — Official wind-down announcement
[2] Reserve API — LCAP basket and mandate

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