[Gauntlet] Arbitrum Native USDC - Risk Recommendations (10/12/23)

Proposals
1

Simple Summary

Gauntlet recommends the following risk parameter change for the Arbitrum v3 Native USDC comet:

  • Increase WBTC supply cap from 300 tokens (~$8.02M) to 600 tokens (~$16.04M).

This change will decrease WBTC supply cap utilization from 100% to 50%.

Analysis

The supply cap for WBTC has recently reached 100%.

Below are details of the top WBTC suppliers:

Top 10 WBTC suppliers and percentage of total WBTC supplies:

Screen Shot 2023-10-12 at 4.52.46 PM
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Supply and borrow positions of the top 10 WBTC suppliers:

Screen Shot 2023-10-12 at 4.53.51 PM
Screen Shot 2023-10-12 at 4.53.51 PM1896×780 56.9 KB

Top 10 WBTC suppliers and borrow usages:

Screen Shot 2023-10-12 at 4.53.13 PM
Screen Shot 2023-10-12 at 4.53.13 PM1882×788 83.1 KB

Given the demand for WBTC supply, sufficient WBTC DEX liquidity on Arbitrum, and BTC’s high liquidity & low volatility, Gauntlet recommends increasing the WBTC supply cap from 300 tokens (~$8.02M) to 600 tokens (~$16.04M). This change will decrease WBTC supply cap utilization from 100% to 50%, resulting in $8.02M additional WBTC able to be supplied to allow further long-term protocol usage and growth.

Next Steps

  • Target on-chain vote 10/16/23.
4 Likes
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We put up the on-chain proposal here.

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The proposal has passed and been executed. We thank the community for their participation.