Gauntlet recs for Aave v3 BASE 2023-07-28
Gauntlet provided initial recommendations for the BASE deployment Temp Check. We refresh our parameters below, given the early stages of BASE mainnet.
| Risk Parameter | WETH | wstETH | USDC | cbETH |
|---|---|---|---|---|
| Isolation Mode | NO | NO | NO | NO |
| Enable Borrow | YES | YES | YES | YES |
| Enable Collateral | YES | YES | YES | YES |
| Emode Category | eth-correlated | eth-correlated | N/A | eth-correlated |
| Loan To Value | 80% | 79% | 77% | 75% |
| Liquidation Threshold | 83% | 82% | 80% | 78% |
| Liquidation Bonus | 5% | 5% | 5% | 7% |
| Reserve Factor | 15% | 15% | 10% | 15% |
| Liquidation Protocol Fee | 10% | 10% | 10% | 10% |
| Debt Ceiling | N/A | N/A | N/A | N/A |
| uOptimal | 80% | 45% | 90% | 45% |
| Base | 1% | 0.3% | 0% | 0% |
| Slope1 | 3.8% | 4.5% | 4% | 7% |
| Slope2 | 80% | 80% | 60% | 300% |
Emode
Under the current framework for LST oracle pricing, we recommend Ethereum-correlated emode be enabled for WETH, wstETH, and cbETH upon launch, with LT 93%, LT 90%, LB 2%.
Supply/Borrow Caps
We give supply/borrow cap recommendations based on assumed BASE TVL upon Aave deployment. It’s hard to predict asset liquidity as well as the proportion of asset market cap proportions to total BASE TVL, so the numbers below are just an approximation. That being said, unlike mainnet Ethereum, we imagine cbETH to have higher liquidity than wstETH on BASE, due to the Coinbase relationship. Again, these numbers are dependent on BASE TVL and liquidity upon launch and may change.
$100mm TVL
| Risk Parameter | WETH | wstETH | USDC | cbETH |
|---|---|---|---|---|
| Supply Cap | 10000 (~$20m) | 5000 (~$10m) | 30m ($30m) | 7500 (~$15m) |
| Borrow cap | 10000 | 200 | 30m | 300 |
For larger TVL, multiply cap numbers by TVL / $100m.