Proposal to Launch Moonwell Flagship USDC Vault on Optimism

Proposals Morpho
2

Proposal to list WETH/USDC and wstETH/USDC markets to Moonwell Flagship USDC vault on OP Mainnet by Block Analitica

Summary

We’re proposing listing first two markets wstETH/USDC and WETH/USDC on the above proposed USDC vault on Optimism with the same market parameters as currently live on Moonwell Flagship USDC vault on Base network, with the supply caps of 30m USDC.

Rationale

This proposal seeks to onboard two new markets to the Moonwell Flagship vault on Optimism (currently only idle market is listed) while considering the risk profile of “Flagship” vaults, and onchain liquidity on the OP Mainnet of those two blue-chip assets: WETH, wstETH.

We’re proposing the same market structure as for the same markets on Base network, including oracles, LLTVs, IRMs, and supply caps.

Note that the current supply cap on WETH/USDC market on Base network is set to 50m USDC (while it is 30m USDC for wstETH/USDC on Base), and while the onchain liquidity on OP Mainnet is sufficient to justify those cap levels, we recommend setting the caps for both WETH/USDC and wstETH/USDC markets to 30m USDC.

Furthermore, we’re proposing utilizing Chainlink market price oracles for both markets, based on our previous analysis in which we have covered the differences between exchange rate and market price oracles for LST pairs. Our analysis indicates that exchange rate oracles are generally more beneficial for LST/ETH pairs, while other markets, including LST/Non-ETH pairs, should ideally use market price oracles.

Also note that this aligns with using market price oracles for wstETH and WETH pricing on the USDC vault on Base.

Market Parameters Summary

wstETH/USDC market

WETH/USDC market

Listing and Veto

The new wstETH/USDC and WETH/USDC market listings were executed on Feb 19, 2025 at 10:50:31 AM +UTC and 10:50:17 AM +UTC. The markets will go live once the 4 day (96h) timelock ends.

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