Simple Summary
Currently, tBTC is listed on the Ethereum USDT, USDC, and USDS comets.
To incentivize tBTC usage, Gauntlet recommends the following tBTC parameter updates across all comets on which it is listed:
- Increase tBTC Collateral Factor from 76% to 80%
- Increase tBTC Liquidation Factor from 81% to 85%
Additionally, we recommend listing tBTC on the Arbitrum USDT and USDC comets with the following parameters:
- Collateral Factor: 80%
- Liquidation Factor: 85%
- Liquidation Penalty: 10%
- Supply Cap: 80 (~$7.94M)
Specification
Recommendations for Existing tBTC Listings:
| Comet | Asset | Parameter | Current Value | Recommended Value |
|---|---|---|---|---|
| Ethereum USDT | tBTC | Collateral Factor | 76% | 80% |
| Ethereum USDT | tBTC | Liquidation Factor | 81% | 85% |
| Ethereum USDC | tBTC | Collateral Factor | 76% | 80% |
| Ethereum USDC | tBTC | Liquidation Factor | 81% | 85% |
| Ethereum USDS | tBTC | Collateral Factor | 76% | 80% |
| Ethereum USDS | tBTC | Liquidation Factor | 81% | 85% |
Recommendations for New tBTC Listings:
| Comet | Asset | Parameter | Recommended Value |
|---|---|---|---|
| Arbitrum USDT | tBTC | Collateral Factor | 80% |
| Arbitrum USDT | tBTC | Liquidation Factor | 85% |
| Arbitrum USDT | tBTC | Liquidation Penalty | 10% |
| Arbitrum USDT | tBTC | Supply Cap | 80 (~$7.94M) |
| Arbitrum USDC | tBTC | Collateral Factor | 80% |
| Arbitrum USDC | tBTC | Liquidation Factor | 85% |
| Arbitrum USDC | tBTC | Liquidation Penalty | 10% |
| Arbitrum USDC | tBTC | Supply Cap | 80 (~$7.94M) |
Analysis
Currently, tBTC is listed on Ethereum USDT, USDC, and USDS comets, with the following risk parameters:
- Collateral Factor: 76%
- Liquidation Factor: 81%
- Liquidation Penalty: 10%
The current tBTC supplies in each comet are shown below:
| Comet | tBTC Supply |
|---|---|
| Ethereum USDT | $2.78M |
| Ethereum USDC | $364k |
| Ethereum USDS | $5k |
Given the low tBTC supplies, we recommend increasing the tBTC Collateral Factor from 76% to 80% and the Liquidation Factor from 81% to 85%, while maintaining the Liquidation Penalty at 10%. This improves capital efficiency without increasing the Liquidation Penalty risk.
Additionally, we recommend listing tBTC on the Arbitrum USDT and USDC comets with the following parameters:
- Collateral Factor: 80%
- Liquidation Factor: 85%
- Liquidation Penalty: 10%
- Supply Cap: 80 (~$7.94M)
Example tBTC/USDC swap on Arbitrum showed below:
