Add market ETH on Scroll

Add Market WETH on Scroll

Summary

The Compound Growth Program along with the Scroll team, proposes the addition of the ETH Comet on Scroll. Addition of the ETH market will open a new avenue for users in the Scroll ecosystem to make use of their idle assets.

Motivation

Scroll’s layer-2 scaling solution provides low-cost, high-speed transactions, unlocking new possibilities for DeFi users. Integrating ETH markets on Compound within the Scroll ecosystem can drive broader adoption and deepen liquidity, enhancing user experience and network growth

Scroll’s commitment to Ethereum alignment ensures security and compatibility, offering Compound users a seamless and scalable experience. With its zkEVM architecture, Scroll brings trustless, efficient transactions that attracts a diverse user base and strengthens DeFi ecosystems across the Ethereum landscape. The Scroll Mainnet was launched on October 2023, since then Scroll has emerged as the number one zk-rollup in terms of TVL.

Point of Contact: Sharp form AlphaGrowth

Proposed Collateral

We propose adding the following asset as collaterals for the market

  • weETH
  • wrsETH
  • puffETH
  • STONE
  • wstETH

We invite the community to suggest and give inputs for any other collateral assets.

Next Steps

We invite the community to consider this application for listing the ETH market and welcome suggestions in this direction.

Additionally, we look forward to the community to suggest

Collateral Factor

Reserve Factor

Borrowing Limit

4 Likes

Add Scroll WETH Comet

If the community wishes to add the assets to following WETH Comets, Gauntlet recommends the following risk parameters:

WETH Comet on Scroll

Asset Collateral Factor Liquidation Factor Liquidation Penalty Supply Cap
weETH 90% 93% 4% 20000
wrsETH 88% 91% 4% 4000
wstETH 90% 93% 3% 3000
pufETH 88% 91% 5% 1000

Onchain Supply

Asset MAX TOTAL SUPPLY
weETH 50.8K
wrsETH 11.4K
wstETH 8.5K
pufETH 3.3K

DEX Liquidity

weETH

pool_name pool_type pool_url pool_tvl_usd volume_24h_usd
weETH / WETH 0.025% nuri-v2 Link $802.47K $166.21K
weETH / WETH syncswap-v2-1-scroll Link $227.91K $3.34K

wrsETH

pool_name pool_type pool_url pool_tvl_usd volume_24h_usd
wrsETH / WETH syncswap-v2-1-scroll Link $528.12K $38.85K
wrsETH / WETH 0.025% nuri-v2 Link $354.46K $107.50K
agETH / wrsETH 0.05% nuri-v2 Link $246.86K $42.94
wrsETH / WETH syncswap-scroll Link $113.01K $20.47

wstETH

pool_name pool_type pool_url pool_tvl_usd volume_24h_usd
wstETH / WETH 0.025% nuri-v2 Link $2.18M $293.93K
wstETH / WETH 0.3% zebra-v2-scroll Link $919.08K $8.87
wstETH / WETH syncswap-v2-1-scroll Link $450.78K $30.75K
wstETH / WETH syncswap-scroll Link $428.61K $1.13K
wstETH / WETH tokan-exchange Link $224.54K $27.29

Collateral Factor, Liquidation Factor and Liquidation Penalty

We tailor the liquidation penalty, collateral factors and liquidation factors based on parameters on mainnet WETH comet. We advise to align pufETH parameters for Scroll WETH comet with those of Mainnet WETH.

Next Steps

  • Welcome Community Feedback
  • Work with community to get asset listed on WETH Comets
1 Like

We recommend aligning the IR curves for this comet to the most recently recommended values for WETH comet.

We also recommend the below values for:

Storefront Price Factor: 70%
Target Reserves: 5000
Seed Reserves: 25 ETH

cant wait for this to launch

Gauntlet - Parameter Recommendations for STONE on Scroll WETH Comet

Simple Summary

If the community wishes to initialize STONE as collateral on the Scroll WETH Comet, Gauntlet recommends the following risk parameters.

Collateral Supply Cap Collateral Factor Liquidation Factor Liquidation Penalty
STONE 10000 88% 91% 5%

Analysis

DEX Liquidity

Pool Type Pool Name Pool TVL (USD) 24H Volume (USD) URL
Ambient STONE / ETH $661.55K $13,010.00 Link
SyncSwap V2.1 STONE / WETH $402.87K $9,741.17 Link
Nuri V2 STONE / WETH 0.025% $337.16K $7,336.41 Link
iZiSwap STONE / WETH 0.3% $128.53K $11,126.36 Link
iZiSwap STONE / WETH 0.05% $25.89K $1,783.60 Link
SyncSwap STONE / WETH $17.53K $94.67 Link

Total TVL: $1.57M

Total Supply

From September to December 2024 STONE total supply on Scroll has nearly halved from 130K to 65K.

Supply Cap and Liquidation Penalty

Given the above liquidity and downward trending total supply data, we recommend setting liquidation penalty on the more conservative side at 5%. Assuming an exchange rate oracle for the market, supply cap can be set less conservatively at 10,000, ~15% of the current max supply on Scroll. This achieves a high degree of capital efficiency while accounting for both low risk of slashing-induced liquidation and potential of continuing total supply reduction.

Liquidation Factor (LF) and Collateral Factor (CF)

STONE/WETH Volatility and Returns

Based on the provided metrics and the proposed liquidation penalty, Gauntlet recommends setting a liquidation factor (LF) of 88% and a collateral factor (CF) of 91% for the WETH comet. These choices again aim to balance capital efficiency with risk mitigation.

Next Steps

  • We welcome community feedback