Title : Increase Max Debt for sfrxETH to $50m
Author : Charlie
Date : 22-11-2023
Summary:
As the max debt from sfrxETH has reached the 33m mkUSD limit, we propose to increase the max debt for this collateral to 50M.
Abstract:
This proposal seeks feedback from the Prisma community to increase the max debt for sfrxETH.
Motivation:
Frax previously received a good risk report from PrismaRisk team highlighting the lack of support for withdrawals which have been deployed recently by the Frax team on mainnet. As Prisma governance process can take a while, I’d like to submit this proposal for a snapshot with the expectation that withdrawals would be supported by the time it concludes.
On top of this, liquidity for sfrxETH has grown steadily on Curve and other DEX allowing for a higher cap.
Spec:
function setParameters(
uint256 _maxSystemDebt to 50000000000000000000000000
)
Proposal to be updated with full call data.
Supporting arguments:
Liquidity on Curve and other DEXes below in past 30 days:
Source: Dex.guru
sfrxETH risk matrix
Benefits (Pros):
Increase mkUSD supply from sfrxETH
Downside (Cons):
Setting max debt from sfrxETH too high can increase the risk of destabilizing the protocol during extreme market events that deplete mkUSD in the stability pool.
Vote:
Coming soon