ARC - Enable Borrowing of DPI on Aave Markets

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governance.aave.com

TL;DR:

MatthewGraham proposed to re-enable DPI borrowing on Aave markets after it was temporarily disabled due to a Cream attack. The proposal, backed by a snapshot vote, suggests a 45% utilisation rate with specific Borrow Interest Rate Parameters, as DPI was found not to be susceptible to the same misuse as xSUSHI.

The discussion primarily revolved around the proposal put forth by MatthewGraham to re-enable the borrowing of DPI on Aave markets. This suggestion was made in the aftermath of DPI being temporarily disabled due to the Cream attack. The AIP-44 safety measure was implemented, which also led to the suspension of xSUSHI borrowing. However, it was later established that DPI was not susceptible to the same potential misuse as xSUSHI, leading to the proposal to reinstate DPI as a borrowable asset on the Aave markets1.

The proposal was motivated by the fact that Index Coop, the author of the proposal, was aware that DPI was never at risk from the attack. They had supported the temporary suspension of the borrowing market as a precautionary measure. Unlike xSUSHI, DPI was not vulnerable due to Index Coop's internal accounting system, which prevents the underlying components from being sent to the contract to inflate its price1.

The proposal recommends enabling borrowing with a utilisation rate of 45%. The Borrow Interest Rate Parameters include LTV 65%, Liquidation Threshold 70%, Liquidation Bonus 8.5%, Reserve Factor 20%, UOptimal 45%, R_0 0%, R_s1 7%, and R_s2 300%1.

In addition to the proposal, MatthewGraham announced a snapshot vote that began on 1st February and concluded on 4th February2. The outcome of this vote will likely determine the future course of action regarding the borrowing of DPI on Aave markets.

Posted 2 years ago

Last reply 2 years ago

Summary updated 2 months ago

Last updated 09/12 13:53