Gauntlet's Risk Recommendation - Increase rETH Supply Cap on BASE (2023-12-06)

Simple Summary

Gauntlet will use Cap Guardian to increase Supply Cap on rETH.

Current Recommended
Supply Cap 265 300

Gauntlet will be utilizing the Cap Guardians to enact this change as voted by the community within this forum post and proposal.

Supporting Data

Supply Cap Usage

There has been high demand to supply rETH to the liquidity pool as shown in the supply cap usage over the past weeks. rETH collateral usage equates to $177k with most top rETH collateral positions either borrowing recursively or with highly correlated assets.

Top rETH Suppliers

Our recommendation to increase the supply cap to 300 represents 75% of the circulating supply on BASE chain. Gauntlet cannot recommend a supply cap with greater concentration of rETH unless there is more rETH bridged into the BASE chain.

Asset Current Supply Cap Supply Cap Usage DEX 2pct Slippage Token DEX 2pct Slippage USD
rETH 265 99% 300 $739k

Supply Guardian increase to rETH has been implemented. Here is the transaction.

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