Gauntlet Analysis
Summary
Gauntlet recommends onboarding fdUSD to Aave V3 BNB. We give further color below.
Assessment
Market Cap
First digital usd (FDUSD) is the fourth-largest stablecoin in terms of market capitalization, currently valued at ~$2.6 billion. Its 2.2% supply (~$49M) is on BSC.
Liquidity
- Mostly traded fdUSD pair is FDUSD/USDT with 24hr trading volume being ~2M on Pancakeswap V3 (BSC). See here.
- FDUSD/USDC trading pair has 24hr trading volume of ~18K on Pancakeswap V3 (BSC). See here.
Reserves
First Digital Labs publishes a monthly reserve report outlining the composition of reserves including U.S. treasury bills maturing in less than three months, cash deposits in U.S. dollars, one-month U.S. dollar fixed deposits, and overnight reverse repos collateralized by U.S. treasury bills.
S&P Global assesses the ability of fdUSD to maintain its peg to the U.S. dollar as constrained.
Recommendations
Given the on-chain liquidity and market cap profile analyzed above, Gauntlet recommends parameters as below.
| Parameter | Recommendation |
|---|---|
| Isolation Mode | NO |
| Borrowable | YES |
| Borrowable in Isolation | YES |
| Emode Category | NO |
| Collateral Enabled | YES |
| Stable Borrowing | NO |
| Supply Cap | 4M |
| Borrow Cap | 3.6M |
| Debt Ceiling | N/A |
| LTV | 70% |
| LT | 75% |
| Liquidation Bonus | 5% |
| Reserve Factor | 20% |
| Base | 0% |
| Variable Slope 1 | 6% |
| Variable Slope 2 | 75% |
| Uoptimal | 90% |