Summary
A proposal to increase the borrow caps for cbETH on Base
Motivation
cbETH (Base)
cbETH has hit its borrow cap following new borrowing demand in recent days; it has previously reached its borrow cap before the debt was repaid.
Borrow Distribution
The top two cbETH borrowers are both looping the asset with WETH-correlated assets, putting their positions at limited risk of liquidation.
Recommendation
Given on-chain liquidity, user behavior, and the relatively small borrow cap relative to total supply, we recommend doubling the borrow cap.
Specification
| Chain | Asset | Current Supply Cap | Recommended Supply Cap | Current Borrow Cap | Recommended Borrow Cap |
|---|---|---|---|---|---|
| Base | cbETH | 3,000 | No Change | 200 | 400 |
Next Steps
We will move forward and 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