To reduce governance overhead and not delay the implementation of the changes (including the update for Arbitrum and Polygon) any further, we propose the following:
Optimism
As both proposals are very similar, we suggest going straight to AIP with a joint proposal, updating Chaos’ original recommendations while incorporating Gauntlet’s recommendations for LINK, WBTC, and AAVE.
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LINK
- Both proposals have almost the same Supply Cap. We recommend incorporating Gauntlets’ recommendations as their suggested Borrow cap is slightly more conservative while still allowing room for significant borrowing (<10% utilization)
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WBTC
- We recommend incorporating Gauntlets’ recommendations as their suggested Supply and Borrow caps are slightly more conservative while allowing room for significant borrowing (<10% utilization). Both proposals effectively freeze the supply.
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AAVE - both proposals effectively freeze supply.
We will continue monitoring these markets and propose updated supply caps with changing market conditions.
Recommendations:
| Asset | Current Supply | Current Supply Cap | Recommended Supply Cap | Current Borrow | Current Borrow Cap | Recommended Borrow Cap |
|---|---|---|---|---|---|---|
| DAI | 2,620,000 | 2,000,000,000 | 25,000,000 | 1,210,000 | N/A | 16,000,000 |
| sUSD | 1,510,000 | 20,000,000 | No Change | 783,150 | N/A | 13,000,000 |
| USDC | 48,510,000 | 2,000,000,000 | 150,000,000 | 15,870,000 | N/A | 100,000,000 |
| USDT | 3,880,000 | 2,000,000,000 | 25,000,000 | 3,100,000 | N/A | 16,000,000 |
| AAVE | 61,890 | 100,000 | 45,000 | N/A | N/A | N/A |
| LINK | 93,050 | 258,000 | 160,000 | 10,661 | 141,900 | 84,000 |
| WBTC | 636 | 1,100 | 620 | 21 | 605 | 250 |
Avalanche
A deciding Snapshot vote with two options for the community to vote on.
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Both options will have the same recommendations for stables (DAI, FRAX, MAI, USDC, and USDT), AAVE, and LINK - as proposed in the original post.
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WETH - As the supply cap is almost identical, we recommend incorporating Chaos Labs’ borrow cap recommendation as it is more conservative while still allowing room for significant borrowing (~17% utilization).
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WAVAX - incorporate Gauntlets’ recommendations.
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Let the community decide between the following options for BTC.b and WBTC.e:
- Aggressive - the higher supply and borrow cap between the two options.
- Conservative - the lower supply and borrow cap between the two options.
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It is important to note that for BTC.b, both proposals effectively freeze new supply.
Recommendations :
| Asset | Current Supply | Current Supply Cap | Recommended Supply Cap | Current Borrow | Current Borrow Cap | Recommended Borrow Cap |
|---|---|---|---|---|---|---|
| DAI | 12,260,000 | 2,000,000,000 | 30,000,000 | 6,480,000 | N/A | 20,000,000 |
| FRAX | 16,260 | 50,000,000 | 1,500,000 | 15,281 | 2,000,000 | 1,000,000 |
| MAI | 113,620 | 50,000,000 | 700,000 | 103,660 | 2,000,000 | 460,000 |
| USDC | 156,940,000 | 4,000,000,000 | 250,000,000 | 97,960,000 | N/A | 175,000,000 |
| USDT | 52,450,000 | 2,000,000,000 | 200,000,000 | 35,930,000 | N/A | 140,000,000 |
| AAVE | 3,860 | 4,500 | 5,800 | N/A | N/A | N/A |
| LINK | 294,870 | 353,000 | 440,000 | 5,750 | 220,000 | No Change |
| WETH | 22,960 | 113,000 | 38,000 | 3,438 | 62,150 | 20,500 |
| WAVAX | 2,890,000 | 13,100,000 | 3,800,000 | 1,040,000 | No Cap | 1,200,000 |
Option 1 - Aggressive
| Asset | Current Supply | Current Supply Cap | Recommended Supply Cap | Current Borrow | Current Borrow Cap | Recommended Borrow Cap | Notes |
|---|---|---|---|---|---|---|---|
| BTC.b | 3,950 | 5,800 | 3,500 | 364 | 3,190 | 1,900 | freezes supply |
| WBTC.e | 1,340 | 5,233 | 2,000 | 223 | No Cap | 1,100 |
Option 2- Conservative
| Asset | Current Supply | Current Supply Cap | Recommended Supply Cap | Current Borrow | Current Borrow Cap | Recommended Borrow Cap | Notes |
|---|---|---|---|---|---|---|---|
| BTC.b | 3,950 | 5,800 | 3,000 | 364 | 3,190 | 900 | freezes supply |
| WBTC.e | 1,340 | 5,233 | 1,400 | 223 | No Cap | 770 |