Gauntlet's Proposal to Become Cap Guardian on Moonbeam and Moonriver

After the approval of this proposal in July 2023, Gauntlet assumed the role of Guardian for the Supply and Borrow Caps on Base. This position has been critical in enhancing risk management on Base, particularly in the dynamic crypto market. Since the fourth quarter of 2023, there have been 16 changes in the Base parameters, implemented under Gauntlet’s guardianship to adapt to these evolving conditions.

  • Oct 3, 2023: Lowered caps for UbSDC
  • Oct 25, 2023: Lowered caps for UbSDC
  • Nov 10, 2023: Increased borrow caps for USDC
  • Nov 13, 2023: Increased caps for wstETH
  • Nov 17, 2023: Increased caps for wstETH
  • Nov 22, 2023: Increased caps for rETH
  • Nov 29, 2023: Increased caps for rETH
  • Nov 29, 2023: Decreased caps for USDbC
  • Dec 6, 2023: Increased caps for rETH
  • Dec 7, 2023: Increased caps for rETH, wstETH, DAI
  • Dec 11, 2023: Increased caps for rETH, WETH, wstETH, and cbETH
  • Dec 18, 2023: Increased caps for rETH + Provided a no-cap change for DAI
  • Dec 28, 2023: Increased supply cap for USDC
  • Jan 9, 2024: Increased Borrow Caps on rETH on Base, and decreased Supply caps for DAI
  • Jan 16, 2024: Increased Borrow Caps for wstETH and USDC on Base
  • Jan 22, 2024: Decreased Borrow and Supply Caps for DAI

Borrow Cap Guardians Recommendation

Enable Gauntlet as Borrow Cap Guardian

To enhance risk management and foster efficient growth within the Moonbeam and Moonriver instance of Moonwell, Gauntlet proposes to serve as Borrow Cap Guardians. Please note that Gauntlet is proposing to become the Guardian only for Borrow Caps, as there are no Supply Caps on Moonbeam and Moonriver instances. This role would enable the Moonwell community to delegate the authority for adjusting caps to Gauntlet. According to the Moonwell technical docs, the Cap Guardian function is beneficial for delegating the adjustment of borrow caps across markets to specialists in these adjustments, without granting them full administrative access to the rest of the protocol. As an active community participant with specialization in these adjustments, Gauntlet suggests being appointed as Guardian. The reasons for seeking this guardianship are:

  • Proactive Cap Adjustments: This role allows us to quickly modify caps in response to market risk events, on-chain DEX liquidity fluctuations, and changes in liquidity pool usage.
  • Streamlined Process: It simplifies the voting process and operational procedures.
  • Expedited Recommendations: Gauntlet can propose adjustments to borrow caps without the standard 3-day voting period and timelock, enabling faster implementation of cap changes.

If entrusted with Guardian, Gauntlet commits to adhere to the following limitations when making borrow cap adjustments:

  • For each asset, only one increase is allowed every five days.
  • The borrow cap can never exceed 100% of its current value.

Additionally, Gauntlet will ensure transparency and community engagement by informing the community about any cap changes and providing the rationale through forums.

Next Steps

Two snapshots will be posted next week for Moonbeam and Moonriver instances.
If the community supports this proposal, Gauntlet will integrate an on-chain vote into the next cycle of risk recommendations for Moonbeam and Moonriver.