Interest Rate Curve Changes for Aave V2 ETH

Summary

A proposal to make parameter changes on Aave V2 ETH.

Abstract

Many interest rate curves on Aave have not changed for a long time and, in the case of some assets, have never been updated for the lifetime of the asset listing. Given the significant shifts in crypto markets, Gauntlet has evaluated assets on Aave and has identified opportunities to adjust parameters for certain assets for the benefit of the protocol.

Motivation

Among other factors, there are two primary reasons to adjust an interest rate curve:

1. mitigate the risk of 100% utilization in a pool
2. build reserves via protocol revenue to cover insolvencies or other expenses in the future

Specification

Implementation

The proposal sets the interest rate strategy contract used by TUSD and USDT using the setReserveInterestRateStrategyAddress call on the LendingPoolConfigurator contract, and sets the reserve factor of TUSD by using the setReserveFactor method on the same.

The interest rate strategy contracts have been deployed and verified:

• For TUSD: 0x6bcE15B789e537f3abA3C60CB183F0E8737f05eC
• For USDT: 0x33DeAc0861FD6a9235b86172AA939E79085c6f52

Copyright

Copyright and related rights waived via CC0.

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