[Signal Request] Adjust KNC-A Debt Ceiling

KyberDAO has recently approved and began a migration process from the current KNC token to a new KNC token version. Full details and migration guide can be found here. Migration may cause a decline in liquidity for the current KNC token which backs the KNC-A vault type.

I want to gauge community support for reducing the KNC-A vault maximum debt ceiling (also know as the line) to 0 DAI, in preparation for the eventual deprecation of this token. You can learn more about the line/debt ceiling parameter in the docs here. Note that this will prevent new borrowing from this vault type but will not affect existing borrowing positions.

Benefits:

  • Reduce risk from legacy KNC token, which may see less liquidity in the future
  • Potential for lower oracle costs in future if vault is fully deprecated

Drawbacks:

  • Lose future business from KNC-A vault users, and accompanying DAI income

Signal Request Question

Should we reduce the KNC-A vault maximum debt ceiling (line) from 5,000,000 DAI to 0 DAI?

  • Yes, reduce KNC-A debt ceiling to 0
  • No, leave KNC-A debt ceiling at 5,000,000
  • Abstain

0 voters

Next Steps

Voting will run for 2 weeks, until 11 May 2021. If a majority of forum voters (excluding abstain voters) support reducing the KNC-A debt ceiling, this will move forward to an on chain poll of MKR holders.

This signal request is part of a longer term plan for addressing the KNC token migration. Review the proposed deprecation process here.

5 Likes

With a 5M debt ceiling and only 50k DAI drawn, this seems like a no-brainer to me. Why even have a signal request? Seems like a waste of time and attention.

3 Likes

That’s a fair point, I mostly agree with you :slight_smile:

The Maker Open Markets Committee (PPG-OMC-001) already is making proposals on debt ceiling changes, so this could potentially be handled this way instead of through a signal request.

But on the other hand I think it could be worthwhile to make sure the community agrees with deprecation of KNC, as community sentiment is not so clear cut as it was with USDT (which is having DC reduced to 0 later today per executive vote).

2 Likes