[ARFC] Add FRAX Arbitrum Aave v3

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The Aave Protocol community discussed and supported a proposal to add FRAX, a stablecoin, to the Arbitrum v3 Liquidity Pool, providing an alternative to the existing USD stable coins. The proposal, which includes specific risk parameters and is backed by Gauntlet's methodologies, is now moving forward through a Snapshot vote.

The discussion revolved around the proposal by Fig to add FRAX, a popular stablecoin, to the Arbitrum v3 Liquidity Pool on the Aave Protocol1. The addition would provide users with an alternative to the four USD stable coins currently available on Aave v3, allowing them to borrow FRAX and earn yield across DeFi platforms like Curve Finance and Convex Finance. The proposal also included risk parameters such as a supply cap of 7.5M, a borrow cap of 2.5M, and an LTV of 67.00%1.

Several community members, including ChaosLabs and Tuanyuan2008 from Gauntlet, expressed support for the proposal, recommending the listing of FRAX in Isolation Mode2,3. They suggested parameters based on FRAX's price volatility, liquidity, and Gauntlet’s methodologies. These included a 75% Loan to Value (LTV), an 80% Liquidation Threshold (LT), a 5% Liquidation Bonus, and a 10% Liquidation Protocol Fee. They also proposed a debt ceiling of $3M and initial supply and borrow caps set at 10M and 6M respectively2,3.

The discussion concluded with TokenLogic announcing the publication of a Snapshot vote to progress the proposal through the governance process4. The community's overall sentiment was positive towards the addition of FRAX to the Arbitrum v3 Liquidity Pool, with the expectation that it would enhance the platform's offerings and provide more options for users.

Posted 6 months ago

Last reply 5 months ago

Summary updated 2 months ago

Last updated 09/12 13:52