[ARFC] Gauntlet Recommendation to Increase v3 Ethereum Caps, 2023-10-18

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Gauntlet proposed increasing the WSTETH and BAL supply caps for Ethereum v3 due to high current usage, with the community awaiting feedback from ChaosLabs. While ChaosLabs supports the BAL cap increase, they advise against the WSTETH cap increase due to increased VaR in stress tests, but commit to future reassessments.

The discussion revolves around the proposed changes to the borrow and supply cap for Ethereum v3. Gauntlet has put forth a suggestion to increase the WSTETH supply cap from 850k to 1.1m and the BAL supply cap from 350k to 700k. The motivation behind this proposal is the current usage of the BAL supply cap, which is nearly fully utilized at 99%, and the WSTETH supply cap, which is being used to about 85%.

The community is actively seeking feedback from ChaosLabs on these suggestions. The future course of action will be determined by the Risk Steward1. The community is keen on understanding how these proposed changes will impact the overall operation of Ethereum v3. The discussion is still ongoing, and the final decision will be based on the feedback received and the subsequent discussions.

ChaosLabs has shown support for the recommended cap increase for BAL. However, their stress tests indicate an increase in VaR with higher supply caps of WSTETH, leading them to advise against increasing the supply cap at this time. They acknowledge the potential benefits to the protocol and commit to continue monitoring usage, DEX liquidity, and market changes to recommend another increase of supply caps when possible2. Gauntlet has queued the BAL cap increase via Risk Steward for a proposal related to Safe{Wallet}3. This update has been executed by ChaosLabs via Risk Steward4.

Posted 2 months ago

Last reply a month ago

Summary updated a month ago

Last updated 06/12 00:43