[ARFC] wMATIC Supply Cap Increase

Hi Everyone,

A quick update on this proposal.

The following liquidity pools are to be migrated:

stMATIC / wMATIC being migrated to stMATIC / bb-a-wMATIC
MaticX / wMATIC being migrated to MaticX / bb-a-wMATIC

This is expected to lead to around 26,058,510.4 units wMATIC being deposited in Aave v3 on Polygon. The wMATIC utilisation is currently 24.58M units of 47M units. With the expected inflows from the new bb-a-wMATIC linear pools, a total of 50.64M units would be deposited and the overall utilisation would be a little less than the 57M proposed Supply Cap.

With 15.37M units of wMATIC deposited in Aave v2 and Liquidity Mining about to start, the proposed Supply Cap can not accommodate a full Aave v2 to v3 migration plus the bb-a-wMATIC deposits. We may need to revise the proposed Supply Cap higher to accommodate both LM driven and bb-a-wMATIC deposits. A Supply Cap of 66M units would be enough provided the LM does not attract additional deposits or looping strategies. This presents a risk and we are monitoring the market.

A tentative forward schedule is shown below:

  • LM from Lido DAO and Polygon Foundation week commencing 27th March
  • Balancer gauges being deployed on Polygon week commencing 27th March (might slip)
  • Balancer Snapshot vote (soon thereafter)
  • BAL emissions commence (week after prior step)

The above dates are subject to change, but are the best representation of planned events at the time of writing.

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