The last on-chain poll on Lower Stablecoin Stability Fees - November 16, 2020 ended with no consensus and no clear winner (UI on this link still doesn’t report correctly). This means stablecoin fees are still set at 4% and will cause part of stablecoin vaults to reach 100% collateralization ratio on 19th December 2020.
Based on the previous on-chain poll on 9th of November called Stablecoin Action Plan - November 9, 2020 the winning vote was Option 3: “Stability Fees and Debt Ceiling are lowered to zero for existing stablecoin vault types, new stablecoin vault types are created with 4% Stability Fees”. Although this result is no longer binding due to the PSM vote, it still gives an indicator that MKR holders are interested in closing out the stablecoin vaults to 0%.
As mentioned, stablecoin vault will reach 100% CR on 19th of December and at that time we should have 0% fees implemented based on the first Stable Coin Action Plan vote outcome mentioned above. Since we might have only 2 more executives votes left until the end of year (11th December and 18th December), we might want to disable fees already on 11th December, especially if we consider it will take at least three days to implement them due to the GSM delay.
Why I personally also think it makes sense to set stablecoin fees to 0% before the 18th December executive vote is the following. Below is a graph with estimated Collateralization Ratios on all stablecoin vaults on 14th of December (this is 3 days after the proposed 11th December vote due to 3 day GSM delay and assuming we can hopefully have a passing vote on the 11th).
If we implement PSM in the near future with a tin parameter set at 0.1% (based on on-chain poll), around 249m of stablecoin vault debt will have CR above 100.1%, which means they should be able to unwind with a small profit. This means Maker is finally able to collect large amounts of stablecoin accrued fees, if of course those vault owners return and see the small profit opportunity.
It is also quite possible large amounts of vaults are abandoned and the profit opportunity is too small. Also, they might speculate on a much lower DAI price when they perform closing of the vault. Note however, that disabling fees 1 week earlier represents opportunity lost revenue of about 300.000 DAI for Maker.
Another thing in favour of having a vote on 11th instead of 18th of December is that some vaults could already be underwater after 18th December vote is effective due to 3 day GSM delay.
With that in mind I am proposing an on-chain poll to set stability fees on stablecoin vaults (USDC-A, PAX-A and TUSD-A) to 0% in the December 11th executive vote. This time the only two options will be to reduce fees to 0% or no change.
