There were three Signals this week about changing Debt Ceilings for
- WBTC-A (40m increase / 160m DC vote winning)
- LINK-A (5m increase / 10m DC vote winning
- USDT-A (7.5m decrease / 2.5m DC vote winning)
I think all of them make sense and I support including them in Monday’s on-chain poll.
I would also like to propose additional Debt Ceiling adjustments for other Vault types to be included into Monday’s on-chain poll:
ETH-A has more than 200m unutilized DC, mostly due to the last increase related to yETH vaults. It seems yETH developers are still testing the new implementation, which might take some time. It is also questionable what kind of demand yETH vaults can attract this time when farming yields are much lower than in the past. I think leaving around 100m buffer should be fine.
It seems the initial 6% rate for ETH-B was too high to attract demand or migration from current ETH-A vaults, probably because liquidity mining yields have fallen in the past weeks. By proposing 4% SF we might see more traction. Still, ETH-B has OSM risks and since even 4% SF is questionable to attract huge demand, we might want to always have maximum utilization of DC. This is why 10m debt ceiling reduction is proposed. But again, we don’t know how much additional demand lower SF can attract and maybe we should be more optimistic here and leave DC where it is?
MANA liquidity became very shallow in the past few weeks and there is virtually no liquidity on DEX. Majority of volume happens on Huobi where wash trading might be performed. Daily traded volume reaches only $700.000 on average (7d rolling) if we include only relevant pairs and exchanges (as said Huobi is already questionable although included in volume metrics). Our new models for risk parameters that we are testing are showing that MANA should have only around 200.000 DAI DC at current liquidity levels. The limit is mostly defined by the ratio between DC and average daily CEX volume where we set 25% as a threshold.
Please vote on the poll below regarding Debt Ceiling changes for ETH-A, ETH-B and MANA-A.
Lower ETH-A Debt Ceiling from current 540m DAI to:
- 440m DAI
- 490m DAI
- No change
Lower ETH-B Debt Ceiling from current 20m DAI to:
- 10m DAI
- 5m DAI
- No change
Lower MANA-A Debt Ceiling from current 1m DAI to:
- 500.000 DAI
- 250.000 DAI
- No change
Poll is open until this Sunday, November 1st 8pm UTC.