Summary
A proposal to increase:
- Ethereum:
- Supply cap for RPL
- Supply and Borrow cap for MKR
- Supply cap for UNI
- Borrow cap for cbETH
Motivation
The recommendations below were made utilizing Chaos’ supply and borrow cap methodologies and after analyzing user positions for each asset.
RPL
The supply cap for RPL on V3 Ethereum is currently at 100% utilization. The cap has been recently increased and filled within a few days, with the main supplier being account 0x6e96a8f5493d55c3a5cdbf2b2d8e049f812a929a, supplying nearly 65% of all RPL tokens.
As RPL is listed as a non-collateral asset, we recommend doubling the current supply cap to 840K RPL. Given the current borrow cap utilization, we do not recommend increasing it at this time.
MKR
The supply and borrow cap for MKR on Ethereum are currently at 97% and 82% utilization, respectively.
We recommend increasing the supply cap to 15K and doubling the borrow cap to 3K. This will also allow additional room for migration from V2.
Please note that the debt ceiling for MKR on V3 has reached nearly 100%. We will follow up with an analysis and recommendations in a separate post.
UNI
The supply cap for UNI on Ethereum is currently at 85% utilization. This will also allow additional room for migration from V2.
We recommend doubling the supply cap to 4M.
cbETH
The borrow cap for cbETH on Base is currently at 99% utilization.
We recommend doubling the cap from 1,200 to 2,400.
Specification
| Chain | Asset | Current Supply Cap | Recommended Supply Cap | Current Borrow Cap | Recommended Borrow Cap |
|---|---|---|---|---|---|
| Ethereum | RPL | 420,000 | 840,000 | 160,000 | No Change |
| Ethereum | MKR | 10,000 | 15,000 | 1,500 | 3,000 |
| Ethereum | UNI | 2,000,000 | 4,000,000 | 500,000 | No Change |
| Ethereum | cbETH | 60,000 | No Change | 1,200 | 2,400 |
Next Steps
Once we receive feedback from @Gauntlet on the above recommendations, we will be able to move forward to implement these updates via the Risk Steward process.