GHO Stability Module Update

GSM Launch Parameter Recommendations

Given community interest in launching the GSM now as opposed to waiting for the recommended GHO conditions, Gauntlet and @ChaosLabs recommend the following launch parameters.

GSM Parameters

We recommend the following updated parameters for the GSM under current conditions (GHO at ~$0.983).

Freeze / unfreeze

  • freeze at [0.99, 1.01]
  • unfreeze at [0.995, 1.005]

Buy/sell fees

  • 0.2%

Since the GSM is planning to be launched without seed liquidity, we continue to recommend buy/sell fees of 0.2%.

GSM caps

  • 500k for USDC, USDT

The lowered GSM caps can help to bring temporary blips > 1 back to peg (assuming liquidity remains similar in structure to current conditions, given the temporary nature).

Capping GSM to lower caps may help reduce risk of unexpected GHO minting via GSM and potential associated market selling that could negatively impact the peg.

Should GHO going over peg be consistent, that may indicate our other GSM launch conditions have been met (such as the price > $0.995 condition), and as such we could recommend to increase caps at that time.