[ARFC] - Chaos Labs Risk Stewards - Increase Supply and Borrow Caps on V3 Arbitrum - 01.11.2024

Arbitrum v3 Supply and Borrow Cap Recommendations and Analysis


As seen in our dashboard, the supply and borrow caps for USDC on Arbitrum v3 have reached 100% utilization, up from 83% and 81% respectively in the last two days. Given sufficient USDC circulating supply, we agree with doubling the USDC supply cap from 64M to 128M and doubling the USDC borrow cap from 60M to 120M.

Screen Shot 2024-01-11 at 3.47.16 PM


Also seen in our dashboard, ARB supply cap utilization has recently reached 100%, with borrow cap utilization remaining around 10%. Given sufficient ARB liquidity, we agree with increasing the ARB supply cap from 20M to 40M, while maintaining the current borrow cap of 16.5M.

Screen Shot 2024-01-11 at 4.12.10 PM


We agree with the recommendations as stated in the analysis, noting that the correct specification is as follows:

Chain Asset Current Supply Cap Recommended Supply Cap Current Borrow Cap Recommended Borrow Cap
Arbitrum USDC 64,000,000 128,000,000 60,000,000 120,000,000
Arbitrum ARB 20,000,000 40,000,000 16,500,000 No Change