Overview
Based on the latest data, Chaos Labs has reviewed the previously recommended syrupUSDC listing on Ethereum Core to reflect material changes in total supply and liquidity, and recommends a corresponding initial supply cap parameter to ensure a smooth market launch. In addition, based on our expectations for the syrupUSDC use case, we have adjusted its configuration to achieve tighter risk control without compromising market efficiency.
Market Cap & Liquidity
Since our last review of syrupUSDC in October 2025, its on-chain total supply has experienced rapid growth. The total supply increased from approximately 1.0B in early November 2025 to around 1.45B by mid-December 2025, representing roughly a 45% increase over a 45-day period and indicating strong expansion momentum. Although some fluctuations were observed toward the end of December, the overall trend remains upward. As of the time of writing, the on-chain total supply stands at approximately 1.2B.
syrupUSDC liquidity on Ethereum is primarily concentrated on Fluid and Uniswap. The syrupUSDC/USDC Fluid liquidity pool holds a total value locked of approximately $20M, while the syrupUSDC/USDC Uniswap v4 liquidity pool holds a TVL of around $20.1M. Both pools demonstrate solid liquidity depth. Compared to our previous review, where a sell order of 15M syrupUSDC into USDC would conservatively incur approximately 0.2% slippage, current market conditions indicate that a sell order of 25M syrupUSDC can be executed with a similar 0.2% slippage. This reflects a meaningful improvement in syrupUSDC’s overall liquidity profile.
Recommendation
Given the sustained expansion of both supply and liquidity for syrupUSDC on Ethereum Core, current on-chain dynamics point to strong and growing user demand. In light of this, we recommend increasing the initial supply cap to 200M to ensure the market is appropriately provisioned from launch and can scale efficiently without artificial constraints on capital utilization. Importantly, supported by the continued strengthening of the liquidity profile, this higher supply cap is not expected to introduce any additional material risk to the protocol.
At the same time, we recommend configuring syrupUSDC as non-collateral on the Core instance and enabling it only as collateral within the Stablecoin E-Mode, in line with its expected use case. At launch, syrupUSDC was enabled as collateral in the Core instance to maintain a permissive baseline configuration and avoid prematurely constraining potential use cases. However, as a yield-bearing stablecoin, syrupUSDC’s intended and most capital-efficient use case is stablecoin-to-stablecoin borrowing, for which E-Mode provides a more appropriate and purpose-built collateral framework. This design choice is validated by the launch of syrupUSDT, the sister asset of syrupUSDC, on Aave, where a stablecoin E-Mode–only configuration has aligned well with its use case and supported rapid growth across Ethereum Core and Plasma.
As a result, maintaining collateral functionality in both Core and E-Mode is redundant and provides limited incremental benefit, while unnecessarily expanding the asset’s risk surface. We therefore recommend disabling syrupUSDC as collateral in the Core instance and restricting collateral usage to E-Mode, aligning the configuration more closely with the asset’s design intent and improving overall risk containment.
Specification
Ethereum Core
| Parameter | Value |
|---|---|
| Isolation Mode | No |
| Borrowable | No |
| Collateral Enabled | No |
| Supply Cap | 200,000,000 |
| Borrow Cap | - |
| Debt Ceiling | - |
| LTV | - |
| LT | - |
| Liquidation Bonus | - |
| Liquidation Protocol Fee | 10% |
| Variable Base | - |
| Variable Slope1 | - |
| Variable Slope2 | - |
| Uoptimal | - |
| Reserve Factor | - |
| E-Mode | Stablecoin E-Mode |
Stablecoin E-Mode
| Parameter | Value | Value | Value |
|---|---|---|---|
| Asset | syrupUSDC | USDC | USDT |
| Collateral | Yes | No | No |
| Borrowable | No | Yes | Yes |
| Max LTV | 90.00% | - | - |
| Liquidation Threshold | 92.00% | - | - |
| Liquidation Bonus | 4.00% | - | - |
Disclaimer
Chaos Labs has not been compensated by any third party for publishing this recommendation.
Copyright
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