[ARFC] Increase USDS Borrow Rate to Match Sky Savings Rate

Governance General
1

[ARFC] Increase USDS Borrow Rate to Match Sky Savings Rate

Author: ACI (Aave Chan Initiative)

Date: 2024-10-16

Summary

This ARFC proposes a Direct-To-AIP adjustment to the USDS borrow rate on the Aave protocol, increasing it to align with the Sky Savings Rate.

Motivation

The Sky Savings Rate has recently outpaced the USDS borrow rate on Aave. To correct this and ensure the protocol is directing incentives to true depositors instead of USDS loopers, we propose raising the USDS borrow rate to match the Sky Savings Rate.

Specification

USDS Borrow Rate will be adjusted as follows

  • Base Variable Rate: 6.25%

All other parameters remain unchanged.

Next Steps

  1. Implement the proposed borrow rate increase via a Direct-to-AIP process.
  2. Monitor borrow rate and use authorized discretion for further rate adjustments.

Disclaimer

This proposal is made independently by the ACI.

Copyright

Copyright and related rights waived via CC0.

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2

[ARFC-Addendum] Update Slope1 of USDS on Aave v3

Author: ACI (Aave Chan Initiative)

Date: 2024-10-22

Summary

Proposal to update the USDS Slope1 to .75%

Motivation

While the latest AIP for USDS borrow rate has intended effect of disincentivizing USDS borrows and looping on Main instance, the current slope1 is too aggressive compared to other stables. A new AIP to address unnecessarily high borrow rate for USDS has been created with an updated slope1 at 0.75%.

Specification

USDS Slope1 will be adjusted as follows

  • New Slope1 .75%

All other parameters remain unchanged.

Next Steps

  1. Implement the proposed parameter change via a Direct-to-AIP process.
  2. Monitor borrow rate and use authorized discretion for further rate adjustments.

Disclaimer

This proposal is made independently by the ACI.

Copyright

Copyright and related rights waived via CC0.