# \[ARFC\] Chaos Labs Risk Stewards - Increase Supply Caps wstETH Arbitrum and Ethereum **URL:** \ **Category:** Governance\ **Created:** [June 17, 2023, 7:38pm UTC](https://governance.aave.com/t/arfc-chaos-labs-risk-stewards-increase-supply-caps-wsteth-arbitrum-and-ethereum/13735 "2023-06-17T19:38:23Z")\ **Posts on this page:** 1\ **Showing post:** 7
**Author:** ![ChaosLabs](https://dub1.discourse-cdn.com/flex013/user_avatar/governance.aave.com/chaoslabs/32/6850_2.png) [@ChaosLabs](https://governance.aave.com/u/ChaosLabs)\ **Post date:** [July 5, 2023, 7:10pm UTC](https://governance.aave.com/t/arfc-chaos-labs-risk-stewards-increase-supply-caps-wsteth-arbitrum-and-ethereum/13735/7 "2023-07-05T19:10:22Z")
With the update to the wstETH oracle on Arbitrum [implemented](https://app.aave.com/governance/proposal/?proposalId=248), the price is calculated from the exchange rate leading to a steady correlation between wstETH and ETH. As the primary use case on V3 Arbitrum involves leveraging wstETH as collateral to borrow ETH, the risk of liquidation is minimal. Therefore, from a market risk perspective, we are comfortable recommending this increase to unblock protocol growth. The main risk remains counterparty risk, which we do not address in our methodology or recommendations. You can read more about our approach to LSDs [here](https://governance.aave.com/t/chaos-labs-lsd-methodology-update/12829). --- _[View the full topic](https://governance.aave.com/t/arfc-chaos-labs-risk-stewards-increase-supply-caps-wsteth-arbitrum-and-ethereum/13735)._