FRAX Liquidity on Moonbeam: Analysis & Recommendations

Hi @cryptocurious. We believe we have provided comprehensive answers to most of your questions. However, to ensure clarity and convenience, we will compile all the responses below for easy reference.

1. Notification:
There is 100% utilization on the front end of the dashboard, signaling a liquidity crunch within the pool.
We addressed it here.

2. Liquidations:
Addressed here. You commented under this reply.

3. Reason / Incentives to supply FRAX:
Addressed here. Currently, users are receiving a 17.7% APY from WELL/GLMR incentives.

4. FRAX Withdrawals:
We have noted your suggestion and thank you for that. Once the community has decided on the bad debt retrieval process, we will analyze whether it makes sense to implement withdrawal limits.

5. xcUSDT and USDC:
As highlighted in our previous discussion, we are planning to update the xcUSDT and USDC parameters during our upcoming recommendation cycle in early January. Should the Utilization Rate increase significantly and become more critical before that period, we will act accordingly and update the parameters at an earlier date.