Now that we have liquidations-2.0 online we get some flexibility with stable collaterals that previously needed larger buffers because they couldn’t be liquidated. One such collateral that I think is a good candidate is
UNIV2DAIUSDC-A. Currently the liquidation ratio is 105% which allows for 20x leverage. Looking at these charts the APY on this pool has come down to about 1% which is about break-even after you deduct the stability fee. I’m proposing we lower the SF to 0%-0.5% and the liquidation ratio down to 101%. This will allow for 100x leverage which makes even these modest APYs pretty decent. The risk profile is generally the same as USDC, so I think this is an overall plus.
- Move unproductive USDC out of the PSM into this pool
- Uniswap LPs provide one layer of removal from USDC blacklist risk (Circle would have to blacklist the whole pool)
- Governance / risk / dev time (this is parameter change so fairly minor)
- May be a waste of time as liquidity is moving to Uniswap V3
- We should lower the LR to 101%
- We should lower the LR to 102%
- No we should keep the LR at 105%
- Yes lower the SF to 0%
- Yes lower the SF to 0.25%
- Yes lower the SF to 0.5%
- No keep the SF at 1%
Voting will run until Sunday June 6th. If either one of these polls passes then an on-chain vote will created next week Monday, June 7th. This is a slightly expedited signal request as I believe it to be probably uncontentious, and we are receiving fairly bad press from the USDC in the PSM. If the on-chain vote passes then these settings will be combined with the rates group proposal set for next week’s executive (or done in isolation if the rates group proposal does not pass).