Add wUSDM as a collateral on USDC/USDT markets on Optimism

[Gauntlet] - wUSDM Asset Listing on Compound V3 Optimism USDC/USDT markets

Simple Summary

Should the community decide to list wUSDM on Compound V3 on Optimism, Gauntlet recommends the risk parameters below for both USDC/USDT markets:

Parameter Value
Collateral Factor 88%
Liquidation Factor 90%
Liquidation Penalty 5%
Supply Cap 1,400,000

Analysis

Liquidity

DEX Category TVL (million USD) URL
curve_optimism 5.87 Link

Total TVL: 5.87 million

Supply Caps and Liquidation Penalty

We recommend setting a supply cap at 40% of the USDM token supply on Optimism, which equates to a cap of 1.4M wUSDM. Although the current circulating supply of wUSDM is significantly below the proposed cap, we anticipate that increased demand will drive more USDM to be wrapped. With the use of an exchange rate oracle and the current liquidity available on Curve, we believe this level is adequate to allow liquidators to swap for the collateral token effectively, particularly in scenarios involving liquidations due to high-interest rate regimes.

We recommend aligning Liquidation Penalty (LP) to those recommended in this post.

Collateral Factor (CF) and Liquidation Factor (LF)

We recommend aligning Liquidation Penalty (LP) to those recommended in this post.

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