MaticX Risk Parameter & Interest Rate Upgrade
Llama proposes upgrading the MaticX Reserve on Polygon to facilitate an expansion of the MaticX/wMATIC loop strategy.
Utilisation of the MaticX reserve has been trending higher over time and with the introduction of deposit rewards, the SupplyCap has been reached and it now prohibites additional MaticX being deposited.
Increasing the SupplyCap enables the recursive MaticX/wMATIC strategy to grow beyond the current constraints. Enabling borrowing, with a reasonable BorrowCap and SD rewards, is expected to generate significant utilisation of the MaticX reserve.
This proposal facilitates the expansion of MaticX yield based strategies on Aave v3 Polygon by creating more favourable bootstrapping conditions. The introduction of liquidity mining rewards is expected to drive notable inflows and usage to the v3 deployment.
Over the previous months, Llama has been working with various communities to craft favourable conditions on Aave v3 Polygon to facilitate the creation of several yield aggregation products. The below proposals details are applicable:
- Proposal to add MaticX to Aave v3 Polygon Market
- ARFC Aave v3 Polygon wMATIC Interest Rate Update
- ARFC SD Emission_Admin for Polygon v3 Liquidity Pool
- ARFC stMATIC & MaticX Emission_Admin for Polygon v3 Liquidity Pool
This proposal is a continuation of the above work.
In support of the ongoing SD rewards distribution, this proposal seeks to increase the SupplyCap, enable borrowing and introduce a BorrowCap sufficient to create a notable deposit yield.
Detailed analysis can be found on the governance forum, here.
The following risk parameters are being proposed and have been reviewed by Gauntlet.
|Loan To Value||50.00%||58.00%|
|Liquidation Protocol Fee||0.00%||10.00%|
|SupplyCap||6.0M units||8.6M units|
|BorrowingCap||0.00M units||5.20M units|
With borrowing to be enabled, the following interest rate parameters have been reviewed by Llama and Gauntlet.
|Base Stable Rate Offset||2.00%|
|Stable Rate Excess Offset||5.00%|
|Optimal Stable To Total Debt Ratio||20.00%|
Test cases can be found here
Payload Implementation can be found here
New Interest Rate Strategy deployment script can be found here
Proposal Payload deployed address can be found here
Interest Rate Strategy deployed address can be found here
The proposal Payload was reviewed by Bored Ghost Developing.
Copyright and related rights waived via CC0.
Your voting info
1 Mar 2023, 14:40 UTC +00:00
2 Mar 2023, 14:58 UTC +00:00
5 Mar 2023, 06:58 UTC +00:00
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Llama, DeFi_Consulting, scottincrypto & efecarranza