As many of the pools are now at or exceeding 100% utilization

Would recommend the following changes to re-balance the eco-system:

  1. Set at least 1,000,000 USDC and USDT each as protected supply. All the other pools have protected supply.
  2. Apply the following changes to ANY STABLECOIN pool ONLY if utilization reaches or exceeds 100% of the available supply. Once utilization drops below 100%, these changes will no longer take effect.
    A) Increase the borrow APR by 10% relative to the supply APR and remove a cap from both. So if the supply APR goes to 90% for example with 101% utilization, the borrow APR would go to 100%. For each 24 hours that the utilization for that pool consecutively stays or exceeds 100% of the available supply, increase the borrow APR by 5% additionally on a daily (24 hours) basis.
    B) Set collateral factor to 99%
    C) Set liquidation threshold to 99%
    D) Set liquidation penalty to 10% AND auto-liquidate all accounts with negative health status, refreshed every 72 hours. For each 24 hours that the utilization for that pool consecutively stays or exceeds 100% of the available supply, increase the liquidation penalty by 5% daily (24 hours).

I revised the proposal based on the feedback received in the other thread. This way, we can balance legitimate market needs (i.e.: borrowing stablecoins to short waves) while also holding the borrower accountable for a prolonged (weeks to months to years) extreme borrowing position. If we do end up adopting a similar (or parts of this) proposal, can certainly adjust the numbers and parameters to fit the community’s needs while balancing respect for market forces.


Overly complicated. Just disable new borrowing when utilization is above 98%. If $100M in USDC is supplied, borrowing should be disabled after $98M is utilized. Borrowing would be reenabled when enough borrowed is repaid or more supply is added to bring utilization below 98%.


People will withdraw and 100% again.It’s useless.I agree increse the APR.

This seems way too complicated for one proposal. Let’s take it one step at a time. It’s clear something needs to be done about the 100% utilization issue. Naturally, this means the demand for assets is higher than the supply, so the supply APY should adjust accordingly. I’m not sure how this could be accomplished as I’m still relatively new to this, but this is the most important issue at hand right now.

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This is already in place, if there are no assets available for borrowing, you can’t borrow.

No it’s not in place. As soon as any supply is available, it can be immediately borrowed. Whereas if there were a 98% limit, the available supply over the 98% limit could be used only for withdrawal, by people supplying.

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The question is what is the best course of action to bring liquidity back to the depositors so that they feel their money is safe. If they dont all the money will run from the platform with whatever value is left…

I like the idea of increasing the borrow rate by 1%pt each day withdrawals arent available.


As long as the oracle price for USDN is based on $1 and not on market price, 100% utilization will never end unfortunately. Because if you can deposit 100 USDN which you can at the time of writing get for 80 dollars and borrow 90 USDC/USDT, this will be scooped up immediately by borrowers every time. And borrowers do not care about returning that money.


Excellent point… needs to be pegged to some exchange asking price or coingecko.

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The hurts are already happened.
Everyone must take care yourself.
You can short waves on cex, even the whole project can make through this time, but investors can’t make it. The best way to save your wallet is short waves before the team!

We should fix the USDN valuation problem on a separate thread. I made a proposal to use oracle price for all stablecoins. In the meantime, any sort of change of incentives or withdraw/repay only threshold on utilization rate are welcome.