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The Aave community is considering a proposal to introduce stEUR, a staked version of the decentralized EUR-peg stablecoin agEUR, as a collateral-only asset on the Aave V3 Ethereum Pool to diversify the range of decentralized stablecoins. The proposed parameters for stEUR onboarding include a supply cap of 3M, a loan-to-value ratio of 70%, a liquidation threshold of 75%, and a reserve factor of 20%, with the token potentially listed in Isolation Mode on the AAVE protocol.
The community continues to deliberate on the proposal by MarcZeller to introduce stEUR as a collateral-only asset on the Aave V3 Ethereum Pool, under the Aave-chan Initiative (ACI)1. The goal is to diversify the range of decentralized stablecoins, particularly EUR stablecoins, which are currently underrepresented. The stEUR, a staked version of the decentralized EUR-peg stablecoin agEUR, is seen as a promising candidate for this role, as it allows for controlled growth while minimizing risks to the Aave protocol1.
The proposed parameters for the onboarding of stEUR include a supply cap of 3,000,000 stEUR, a loan-to-value (LTV) ratio of 70%, a liquidation threshold (LT) of 75%, and a reserve factor of 20%1. The price feed for stEUR will be determined based on the value of agEUR/USD and the exchange rate of agEUR/stEUR, following the precedent set with sDAI1. ChaosLabs has proposed the listing of stEUR in Isolation Mode on the AAVE protocol as a strategy to increase the protocol's asset offerings. They suggest an initial debt ceiling of $2M, considering the probability of an extreme price drop for stEUR as Medium-High2.
The stEUR token was introduced by Angle on September 19, 2023, and its liquidity has since grown to approximately $5 million. Currently, stEUR has no liquidity on decentralized exchanges, but it can be redeemed seamlessly through the Angle Savings smart contract2. The community is now working towards achieving consensus and moving the proposal to the next stage. Jengajojo supports the parameters recommended by ChaosLabs for onboarding stEUR, based on their analysis3.
The discussion is now moving towards achieving consensus on the ARFC stage and gathering feedback on risk parameters from risk service providers. If the ARFC snapshot stage outcome is YAE, the proposal will progress to the AIP stage1. This proposal represents a significant step towards the diversification and growth of the decentralized stablecoin ecosystem. The proposed parameter settings for listing stEUR include a comprehensive list of parameters, including a supply cap of 3M stEUR, a debt ceiling of $2M, and a LTV of 70.00%2.
Gauntlet has recommended parameters for listing stEUR in the community. The parameters include enabling Isolation Mode and Collateral, setting the Supply Cap at 2m, and the Debt Ceiling at 1.5m. The LTV is set at 70%, LT at 75%, Liquidation Bonus at 8%, and Liquidation Protocol Fee at 10%. The stEUR represents staked agEUR on Angle and accumulates native agEUR yield at 5.3% APY. It is atomically convertible to agEUR via smart contract. agEUR is overcollateralized by a variety of products, including EURC, USDC, etc. Due to low TVL and circulating supply for agEUR, stEUR is recommended to be listed in isolation mode. A conservative methodology is employed for new asset listings, considering stEUR as a non-stablecoin and recommending a supply cap of 2m, limited by 25% depth for agEUR4.
Posted 2 months ago
Last reply a month ago
Summary updated a month ago
Last updated 06/12 00:43