Gauntlet's Risk Recommendation - Increase wstETH Caps on BASE

Simple Summary

Gauntlet will use Cap Guardian to increase Supply and Borrow Cap for wstETH on BASE market.

Current Recommended
Borrow Cap .05 80
Supply Cap .1 180

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

Supporting Data

wstETH on-chain circulating supply and number of holders has been increasing since the initial recommendation and on-chain proposal was submitted:

Asset Current Borrow Cap Current Supply Cap DEX 25pct Slippage Token DEX 25pct Slippage USD On-chain Circulating Supply
wstETH 0.1 0.1 40 $96,400.00 240

The largest current DEX liquidity source can be found on Aerodrome’s vAMM-WETH/wstETH pool.

1 Like

Hey Moonwell Community,
Guardian Action has been implemented. Here are the borrow cap transaction and supply cap transaction.

Reward rates for wstETH have been updated to help bootstrap liquidity for the market.

wstETH Reward stream Emissions per sec (before) Emissions per sec (after)
WELL Supply-side 0 0.1141111493
WELL Borrow-side 0 0
USDC Supply-side 0 0
USDC Borrow-side 0 0
Total supply (%of supply cap) 0% 25% 50% 75% 100%
wstETH Supply WELL APR ∞% 18.85% 9.43% 6.28% 4.71%

Rewards were shifted from ETH market towards wstETH.

  • ETH market utilization is standing at healthy levels from a risk perspective
  • Reducing rewards by 0.11 WELL/second for ETH is less detrimental relative to other markets
Supply-side 20.00% 20.00% 0.00% 20.00% 40.00% → 38.00% 0.00% → 2.00%
Borrow-side 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%