SUSHI Listing on Aave V3 Ethereum
Gauntlet supports listing SUSHI on Aave V3 Ethereum. The following table contains Gauntlet’s recommended initial parameters.
| Risk Parameter | Gauntlet Rec |
|---|---|
| Isolation Mode | YES |
| Enable Borrow | YES |
| Enable Collateral | YES |
| Borrowable in Isolation | NO |
| Loan To Value | 40% |
| Liquidation Threshold | 50% |
| Liquidation Bonus | 10% |
| Reserve Factor | 20% |
| Liquidation Protocol Fee | 10% |
| Borrow Cap | 8,450,000 |
| Supply Cap | 8,450,000 |
| Debt Ceiling | $24,700,000 |
| Base | 0% |
| Slope1 | 7% |
| Uoptimal | 45% |
| Slope2 | 300% |
We recommend the following parameters for SUSHI on Aave V3 Ethereum:
Isolation Mode - Yes
Borrowable - Yes
Collateral Enabled - Yes
E-mode - No
Isolation Mode Debt Ceiling - $24,700,000
We recommend keeping SUSHI in isolation mode. Per Gauntlet’s isolation mode methodology, we recommend the debt ceiling be set to 15% of the token’s circulating market cap. This implies a debt ceiling of $24,700,000. At current prices this is higher than the supply cap; it will not become binding unless token prices rise.
Loan to Value and Liquidation Threshold - 40%/50%
SUSHI has a market cap of $164M, placing it below the other DeFi governance tokens listed on Aave V3 Ethereum. Its DEX liquidity is comparable to those of SNX and MKR. SUSHI’s annualized volatility over the past 28 days is 33.9%. Compare that volatility to LDO at 74.7%, BAL at 46.2%, and CRV at 36.5%, and SUSHI’s volatility is relatively low.
| Symbol | Market Cap | 25% Depth (1inch) | Liquidation Threshold | LTV |
|---|---|---|---|---|
| UNI | $3.8B | $4.5M | 77% | 65% |
| LINK | $3.3B | $4.8M | 65% | 50% |
| LDO | $1.8B | $10.8M | 50% | 40% |
| AAVE | $912M | $10.5M | 73% | 66% |
| SNX | $752M | $1.0M | 65% | 49% |
| CRV | $671M | $9.8M | 61% | 55% |
| MKR | $580M | $910k | 70% | 65% |
| BAL | $219M | $19.8M | 62% | 57% |
| SUSHI | $164M | $1.5M | - | - |
Given SUSHI’s relatively smaller market cap and DEX liquidity, we recommend starting with a conservative LTV of 40% and a conservative LT of 50%, matching the most conservative values of existing DeFi tokens.
Supply and Borrow Caps
Supply Cap (in tokens) - 8,450,000 / Borrow Cap (in tokens) - 8,450,000
Our supply and borrow cap recommendations are set in accordance with Gauntlet’s borrow and supply cap methodology. We recommend capping borrow and supply at half of SUSHI’s average daily trade volume across DEXs and CEXs.
Liquidation Bonus - 10%
We recommend an initial liquidation bonus of 10% to ensure profitable liquidations.
Liquidation Protocol Fee - 10%
Gauntlet recommends an LPF of 10%, matching the LPF for other similar assets.
Reserve Factor - 20%
Gauntlet recommends a reserve factor of 20% for SUSHI on Ethereum, matching the RF of most other non-stablecoins on Ethereum.
IR Curves
We recommend the same IR curves used for other protocol governance tokens on Ethereum, such as LDO, MKR, and AAVE.
| Parameter | Recommendation |
|---|---|
| Base Variable Borrow Rate | 0% |
| Variable Rate Slope 1 | 7% |
| Optimal Usage Ratio | 45% |
| Variable Rate Slope 2 | 300% |