Summary
A proposal to increase the borrow caps for WETH on V3 Arbitrum.
Motivation
The borrow cap for WETH V3 Arbitrum is currently at 78% utilization.
Over 86% of WETH borrowed is against wstETH collateral, as can be seen in the top borrower and distribution carts below.
Utilizing our supply and borrow cap methodology and given the current usage, we recommend increasing the borrow cap to 60K WETH.
Specification
| Chain | Asset | Current Supply Cap | Recommended Supply Cap | Current Borrow Cap | Recommended Borrow Cap |
|---|---|---|---|---|---|
| Arbitrum | WETH | 70,000 | No Change | 40,000 | 60,000 |
Next Steps
Once we receive feedback from @Gauntlet on the above recommendations, we will move forward to implement these updates via the Risk Steward process.
Disclaimer
Chaos Labs has not been compensated by any third party for publishing this ARFC.
Copyright
Copyright and related rights waived via CC0