Proposed Offboarding Collateral Parameters #2

Proposed Offboarding Collateral Parameters for COMP, AAVE, BAL, LRC, BAT, ZRX, UNIV2-LINKETH and UNIV2-AAVEETH

In the recent signal request, the community voted on offboarding COMP, AAVE and BAL collaterals. In addition, parameters from previous offboarding signal request for BAT, ZRX, LRC, UNIV2-LINKETH and UNIV2-AAVEETH have to be updated, due to higher collateral price appreciation than we anticipated. Risk team is proposing the same parameter changes and formula for determining end value for dss-lerp for liquidation ratio, where factor for determining final value is increased from 1.5 to 2, duration is decreased from 60 days to 30 days to fasten the process and the vault considered for the calculation is the highest collateral ratio vault with more than 10k debt instead of previous 15k.

Proposed parameter changes;

  • Set liquidation penalty to 0% for COMP, AAVE, BAL
  • Set debt ceiling to 0 for COMP, AAVE, BAL
  • Set duration of dss-lerp for liquidation ratio to 30 days
  • Set end parameter of dss-lerp for liquidation ratio for each vault type as the following; highest collateral ratio vault within each vault type which has a higher debt than 10,000 dai multiplied with 2, rounded on hundred
  • In the case where the vault type has no vault with debt above 10,000 dai, the formula for calculating the end parameter for liquidation ratio will consider the highest collateral ratio vault

Example of end parameter for BAL-A calculation;

Highest CR vault with more than 10k dai debt is #24281 currently at 943.52%. After multiplying with 2, we get 1887.04% and after rounding, we get 1900%.

Projection of debt liquidated based on the current state of vaults can be seen here.

The final values for liquidation ratio based on 3x multiplier and largest CR vault in each vault type included in the executive vote are; BAL-A to 2100%, COMP-A to 1900%, AAVE-A to 2100%, LRC-A to 22800%, BAT-A to 11500%, ZRX-A to 5600%, UNIV2LINKETH-A to 1600% and for AAVEETH-A since there is no vaults, we only set liquidation penatly and debt ceiling to 0.

Assuming there are no reasonable objections, we would like to proceed with these parameters to the on-chain poll next Monday, 15th of November.

7 Likes

Any objection to us taking the highest Vault CR period or doing a 3x multiplier (or both)?

1 Like

No objections for 3x multiplier. I dont understand the period part. I think its better to finish the offboarding process faster. I updated the formula in the sheets with a 3x multiplier and new vault state.

Probably this was ment to take the highest CR vault into consideration for applying the 3x multiplier without the 10k minimum debt rule, which I also agree with.

Question: Once all the vaults for a Collateral type are liquidated do the oracle fees maker needs to pay go down immediately or do they need to get shut off after?