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Governance Call Recap - Mar 7th, 2024

  • Date: March 7, 2024
  • Time: 5pm UTC
  • Moderator: @alex. from @Boardroom
    Note: No recording this month. Technical difficulties, you understand.

Agenda:

  1. Rebalancing of Base Liquidity Incentives from @WardenFinance
  2. $PINK airdrop application for Moonwell from delegate @curly
  3. Aera Vault migration from Aera V1 to Aera V2 from @Gauntlet
  4. Base/Moonbeam/Moonriver risk parameter and IR curves updates, plus xcUSDC recommendations from @Gauntlet

Meeting Notes:

  • @Luke from Lunar Labs provided an update regarding adopting a new WELL token standard. Moonwell will be looking towards migrating WELL to the xERC-20 standard, creating the ability to have a multi-chain governor contract that allows users to lend, borrow, and vote on Base. Voters should look for proposals coming at the end of this month to unify the network under this new standard. Additionally, he noted the expected adoption of Coinbase’s new Smart Wallets, which are set to deploy soon.
  • Hugo from Warden Finance on the Rebalancing of Base Liquidity Incentives
    • Circulating supply for DAI on Base became critically low. Warden Finance recommended that the lending market supply be capped at 50% of on-chain circulating supply to avoid accumulating bad debt.
    • Hugo noted that rETH circulating supply did not allow for further growth to be sustained. The total supply for rETH lending market was standing at 55% of the circulating supply on Base. Hugo discussed the changes applied by Warden Finance, including drastically decreasing rewards for the DAI market to help reduce supply and borrow activity and shifting cbETH rewards towards WETH and USDC.
    • WELL and USDC supply reward distribution for cbETH decreased from 20% to 15% and DAI decreased from 10% to 5%. USDC and ETH both gained 5%, up from 20% and 40%, respectively.
  • Curly on the $PINK Airdrop Application
    • An application went live on the Moonbeam forums for projects to get a share of a community redistribution of $PINK. Of the 1.25% total supply of $PINK that was allocated to Moonbeam, 50% was reserved for deployed Moonbeam projects with active users.
    • Moonwell delegate @Curly discussed the effort he has led on behalf of Moonwell to receive an airdrop of $PINK. The write-up on the Moonbeam forum for this airdrop proposal can be found here.
    • Curly’s successful application for the airdrop request can be found here.
  • Shaan from Gauntlet on Aera Vault migration from Aera V1 to Aera V2
    • Aera V2 is live in production with users that include Compound and Threshold. It introduces new features, including the ability to generate yield on stablecoins, support for a broader range of assets and strategies, an enhanced security framework, and eliminating imminent loss.
    • Shaan noted that a previous Multichain hack (a cross-chain router protocol) could have resulted in a total loss of the vault’s value in Aera V1. He then gave a product demo of Aera and showed off the financial metrics of the in-app vault. Notably, the Moonwell vault has increased its value by ~30% since the posting of the original forum proposal.
    • You can view the vault here.
  • Sai from Gauntlet on recommendations for Base/Moonriver/Moonbeam and xcUSDC
    • Sai discussed the recommendations published on 2/28/2024 for the three Moonwell deployments. Base had 12 risk parameter changes, including increasing reserve factors for wstETH, rETH, cbETH, and DAI and decreasing the DAI supply and borrow cap. Sai also mentioned the recommended changes in wETH’s and DAI’s IR curves. This combination of these actions was meant to manage concentration risk for DAI, improve overall capital efficiency for the protocol, and increase protocol reserves by raising the reserve factors for the Ethereum-based LSTs. Moonbeam had 6 risk parameter changes; Moonriver had one risk parameter change.
    • Gauntlet used Cap Guardian to implement borrow cap adjustments for xcUSDC, setting the cap at 400,000.
    • @coolhorsegirl proposed to add WBTC lending markets to Base following the asset’s launch on the network. Gauntlet offered to give initial parameter recommendations.

Other Links:

View the Slides here.

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