Simple Summary
Gauntlet will use Cap Guardian to increase the Supply and Borrow Cap for USDC and WETH.
| Asset | Current Supply Cap | Recommended Supply Cap | Current Borrow Cap | Recommended Borrow Cap |
|---|---|---|---|---|
| USDC | 56,000,000 | 75,000,000 | 52,000,000 | 70,000,000 |
| WETH | 40,000 | 50,000 | 28,000 | 40,000 |
Gauntlet will be utilizing the Cap Guardian to enact this change as voted by the community within this forum post and proposal.
Supporting Data
USDC Circulating Supply
The circulating supply of USDC has experienced a tenfold increase since March, and it continues to witness a sustained surge on Base, accompanied by an exponential rise in the number of holders.
USDC Borrowing
Of the top 10 largest suppliers on USDC, 3 positions are borrowing non-stables, one of them being AERO, and the largest position borrowing WETH. There is sufficient liquidity to absorb these positions in the market. Gauntlet will continue to monitor all positions.
WETH Liquidity
WETH on-chain liquidity has a 25% slippage of 11,000 WETH ($33,000,000), however CEX liquidity has been ranging between 80-120M USD.
WETH Positions
4 of the top 10 positions are borrowing USDC and 1 position is only supplying assets. The rest are borrowing recursively. There is sufficient liquidity to absorb positions that are borrowing stablecoins.
Quick Links
Please click below to learn about our methodologies:
Gauntlet Parameter Recommendation Methodology
Gauntlet Model Methodology
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