Summary
A proposal to:
- Increase USDC.e’s supply cap on Aave V3 Gnosis deployment.
Motivation
USDC.e
USDC.e has reached 100% supply cap utilization on Gnosis, and its borrow cap is at 41% capacity.
Supply Distribution
A single user supplies the entire USDC.e supply. This user has no borrow positions open, so there is no liquidation risk.
The assets borrowed against USDC.e represent an insignificant amount.
Borrow Distribution
Out of the top 10 borrowers, 8 borrow USDC.e against highly correlated assets (sDAI, USDC), where liquidation risk is highly reduced. The remaining 2 positions use ETH-correlated collateral and have respective health scores of 1.15 and 1.45.
Recommendation
Given the on-chain liquidity and users’ behavior, we recommend increasing the supply cap to 3,000,000 USDC.e
Specification
| Chain | Asset | Current Supply Cap | Recommended Supply Cap | Current Borrow Cap | Recommended Borrow Cap |
|---|---|---|---|---|---|
| Gnosis | USDC.e | 1,500,000 | 3,000,000 | 1,400,000 | 1,400,00 |
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