Weekly Governance Recaps

Weekly Governance Update: Week of March 25, 2024

The final week of March included ideas for new ecosystem integrations, a pair of MIPs related to multichain governance, and recommendations from @Gauntlet & @WardenFinance.

Here are the highlights:

Integration Updates

Forum post: Activate Moonwell Apollo on Polygon POS

Author: Chiefpreneur

Summary: New poster @Chiefpreneur made a forum discussion on Monday seeking authorization for deploying Moonwell Apollo on Polygon POS mainnet. The noted reasons for this effort include increasing the reach of Moonwell’s lending services to new users, the scalability and low transaction costs of Polygon, and interoperability with other Polygon DeFi protocols.

Forum post: Growth Proposal for Moonwell

Author: XposureToday

Summary: On Wednesday, first-time poster @XposureToday proposed a partnership between Moonwell and a marketing firm, Xposure Today. Components of the proposed 5-week program included an educational onboarding program, a PR article, co-marketing activities, and content creation/distribution. The estimated cost would be $5,000-$12,000.

Contributor Updates

Forum post: Rebalancing of Base Liquidity Incentives

Author: WardenFinance

Summary: The primary reasons for this update were to inform the community that a new rewards pool of 50,000 USDC will be allocated towards the native USDC market rewards over epoch #9 and that a Safety Module for Base will soon be introduced. Warden allocated 17% of epoch #9 WELL rewards to future safety module incentives. WELL rewards were accordingly rebalanced to take into account the new USDC rewards pool.

Forum post: Gauntlet’s Base/Moonbeam/Moonriver Recommendations

Author: Gauntlet

Summary: Gauntlet posted their recommendations for the three Moonwell deployments on Tuesday.

  • Base: Five risk parameters were recommended to be changed: WETH supply and borrow cap (12,500 to 18,000 and 10,500 to 14,000, respectively), wstETH supply and borrow cap (1,800 to 2,100 and 800 to 900, respectively), and USDbC RF (15% to 20%). For IR parameters, only USDC had any recommendations: kink (0.8 to 0.9), multiplier (0.032 to 0.067), and jump multiplier (4.2 to 9.0).
  • Moonbeam: Seven risk parameters were recommended to be changed: xcUSDC and WGLMR collateral factors (10% to 15% and 58% to 57%, respectively), WGLMR borrow cap (22,500,00 to 10,000,000), WBTC.wh borrow cap (50 to 5), WETH.wh borrow cap (500 to 100), and the reserve factors for xcUSDT and xcUSDC (20% to 25%, each). For IR parameters, four assets were recommended changes: USDC.wh (an increase in multiplier from 0.0845 to 0.0875 and an increase in jump multiplier from 7.2 to 7.4), xcUSDC (an increase in multiplier from 0.0814 to 0.0875 and an increase in jump multiplier from 7.0 to 7.4), xcUSDT (an increase in multiplier from 0.0814 to 0.0875 and an increase in jump multiplier from 7.0 to 7.4), and FRAX (an increase in multiplier from 0.01 to 0.0563 and an increase in jump multiplier from 0.01 to 4.0).
  • Moonriver: Three risk parameters were recommended to be changed: FRAX reserve factor and collateral factor (15% to 25% and 57% to 53%, respectively) and WMOVR borrow cap (40,000 to 20,000). Only one IR parameter change was recommended for FRAX (increasing the multiplier from 0.0814 to 0.0875 and the jump multiplier from 7.0 to 7.4).

For more information on Gauntlet’s rationale and the supporting data for these changes, read the linked forum post above.

Forum post: Gauntlet Base, Moonbeam, Moonriver Weekly Market Update

Author: Gauntlet

Summary: Gauntlet posted a weekly update on Saturday for the Moonwell markets covering the previous week.

  • Base: Three assets had an average borrow/supply cap usage of over 75%: DAI (77.79% borrow cap and 78.32% supply cap), wstETH (76.45% borrow cap), and rETH (86.28% supply cap). The deployment had two asset liquidations in the past week: $1.34K mUSDC and $334.29 mWETH.
  • Moonbeam: Two assets had an average utilization of more than 75%: USDC.wh (81.16%) and xcUSDT (76.91%). Three assets experienced liquidations: mFRAX ($154.81), mDOT ($70.72), and mGLMR ($10.08).
  • Moonriver: FRAX was, again, the only asset that experienced an average utilization of >75%, coming in at 102.41%. There were no asset liquidations.

Forum post: Guantlet Guardian - Increase Caps for Native USDC on Base

Author: Gauntlet

Summary: On Monday, Gauntlet made a post to inform the community that they would use Cap Guardian to change the USDC supply cap (from 20,000,000 to 40,000,000) and borrow cap (from 18,200,000 to 36,400,000). This comes after both cap usages increased over the 75% threshold. USDC supply increased exponentially in the days leading up to the forum post.

Forum post: Guantlet Guardian - Increase WETH Supply and Borrow Caps

Author: Gauntlet

Summary: On Saturday, Gauntlet also used Cap Guardian to increase Supply and Borrow caps for wETH from 18,000 to 22,000 (supply) and 14,000 to 16,000 (borrow). Both cap usages increased over the 75% threshold. You can find the corresponding transactions on Basescan here and here.

Forum post: MIP-M23 and MIP-M24: Multichain Governor and WELL Migration

Author: elliot

Summary: Last week, contributor Solidity Labs began a series of governance proposals to enable multichain governance for Moonwell. After MIP-M21 (the first proposal regarding multichain governance) passed, two new proposals were created. MIP-M23 proposed to transfer power from the old governor to the new multichain governor and create the multichain version of WELL (among other implementation details). MIP-M24 was created to accept ownership of the contracts and finalize the new governor’s abilities. On Monday, @curly sought clarification on the implementation details of the pair of MIPs. First, there was concern that raising the minimum proposal threshold would increase the barrier to entry for users attempting to contribute to governance. Curly suggested that this implementation could be tested on the Moonriver deployment before bringing it to Moonbeam/Base. In response, Elliot from Solidity Labs confirmed that multichain governance has been tested on Base Sepolia and Moonbase testnets. Concerning the increase in the minimum proposal threshold, this change would be implemented due to the new feature allowing users to have three active proposals at the same time. Increasing the proposal threshold would deter malicious actors from creating too many proposals. Lastly, he confirmed that the quorum will remain unchanged at 100M WELL. Curly rebutted, stating that the risk of malicious actors creating multiple proposals does not warrant raising the threshold.

Outcome: Both MIP-M23 and MIP-M24 went live for an on-chain vote on Monday. Both proposals passed.

Forum post: MIP-M25 Base Safety Module Activation

Author: elliot

Summary: Following the vote to implement the Multichain Governor contract (MIP-M24) and the xERC20 standard for multichain WELL, MIP-M25 aims to enable rewards for users in the Safety Module with the new WELL token on Base. Elliot mentioned that prior to this going live, the community should be given enough time to bridge Wormhole-wrapped WELL from Base to Moonbeam and back in the Base-native form.

Outcome: Solidity Labs will create a proposal that sets and funds rewards for Safety Module Stakers. Be on the lookout for Warden Finance’s recommended initial reward speeds.

Forum post: Gauntlet Guardian - wstETH Recs

Author: Gauntlet

Summary: Gauntlet announced they would use Cap Guardian to increase the supply caps for wstETH from 2100 to 3000. Previously, the supply cap increased over the 75% threshold. Further, there were considerations for the correlated assets borrowed from the top wstETH suppliers and an exponential increase in the asset’s circulating supply on Base since the start of the year. View the transaction on Basescan here.

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