Warden Finance - Base Liquidity Incentives

Announcements & Updates Updates
11

Rebalancing of Base Liquidity Incentives (2024-04-19)

Updates

Key observations

Lending markets

  • DAI and rETH on-chain liquidity situation has improved. DAI and rETH circulating supply on Base are now sufficient to ensure risk for the protocol to accumulate bad debt is within tolerance given extreme market conditions.
  • Utilization for major markets (ETH and USDC) slightly suboptimal (below kink).

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Safety Module

  • Total deposits: 10.5M WELL (below target of 30M WELL)
  • Current yield: 30.3% APY (over target of 20% APY)

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Applied changes

  • Wormhole WELL reward streams have been deprecated in favor of Native WELL reward streams
  • As no WELL rewards were allocated towards safety module for this epoch, rewards have been increased across all markets. Rewards for ETH and USDC markets have been further increased due to higher elasticity to rate vs. other markets.

Specifications

Epoch # Total per epoch Start timestamp Start date
10 20,045,844.22 WELL**
50,000 USDC		 1713564000 Fri, 19 Apr 2024 22:00:00 GMT

** Amount includes an additional 387,190.37 WELL from unspent safety module allocation due to delayed safety module deployment.

Liquidity incentives

100% of WELL (20,045,844.22 WELL) and 100% of USDC epoch rewards (50,000 USDC) allocated towards liquidity incentives.

Reward distribution (% of allocation) cbETH DAI USDbC USDC ETH wstETH rETH
WELL supply 15% 1% 0% 10%→16% 47%→55% 8%→10% 2%→3%
WELL borrow 0% 0% 0% 0% 0% 0% 0%
USDC supply 0% 0% 0% 100% 0% 0% 0%
USDC borrow 0% 0% 0% 0% 0% 0% 0%

Safety module incentives

No additionnal safety module incentives were allocated for this epoch as safety module is already funded until end of epoch #10.

Next steps

  • Keep monitoring safety module deposits / yield over epoch #10. Apply adjustements for epoch #11 if target safety module parameters are not reached.
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