[Gauntlet] 2023-12-11: Ethereum v3 USDC Reward Recommendations
01Summary
Gauntlet proposes reducing daily COMP borrow rewards on Ethereum v3 USDC from 381.40 to 100, saving Compound approximately $5.14M annually and reducing total protocol emissions by 25.5%.
- Type
- parameter change
Key changes
- Decrease daily COMP borrow rewards on Ethereum v3 USDC Comet from 381.40 to 100 via setBaseTrackingBorrowSpeed method(high)
- Estimated annual COMP emissions savings of $5.14M at current COMP price of $50(high)
- Reduction of total Compound emissions across all markets by 25.5%(high)
Notable concerns
- Significant reduction in borrow incentives may affect user borrowing behavior on this market
Generated by Kvorum
02Description
[Gauntlet] 2023-12-11: Ethereum v3 USDC Reward Recommendations
Simple Summary
A proposal from Gauntlet to adjust one COMP reward distribution in the Ethereum v3 USDC comet.
Gauntlet recommends the following change to Ethereum v3 USDC rewards:
- Decrease Daily COMP Borrow Rewards from 381.40 to 100
For more details, see the full forum post here.
Motivation
Given the current COMP price of $50, this reward reduction would save Compound $5.14M/year in COMP emissions, reducing the total Compound emissions across all markets by 25.5%.
Full proposal and forum discussion
Specification
The proposal updates the COMP borrow rewards on the Ethereum v3 USDC Comet using the setBaseTrackingBorrowSpeed method of the Configurator contract.
By approving this proposal, you agree that any services provided by Gauntlet shall be governed by the terms of service available at gauntlet.network/tos.
03Mismatch analysis
The proposal claims a single change: reducing daily COMP borrow rewards on the Ethereum v3 USDC comet from 381.40 to 100 via setBaseTrackingBorrowSpeed on the Configurator. Action 0 is exactly this call; converting the raw speed value (1157407407407) using the standard Compound III scaling (COMP/day * 1e15/86400) yields 100 COMP/day, matching the description precisely. The target comet address matches the known Ethereum USDC comet, and the Configurator address matches. Action 1 (deployAndUpgradeTo on the CometProxyAdmin) is the standard, expected mechanism to push a Configurator-set parameter live on the comet proxy — this is routine boilerplate for all Compound III parameter-change proposals and is implicitly covered by the 'Specification' section referencing the Configurator, so its omission from prose is not a meaningful discrepancy. No value, target, or omitted/extra action issues were found that a delegate should be warned about.
Generated by Kvorum
04Actions
- Target
- 0x316f…36e3
- Value
- 0 wei
- Function
- setBaseTrackingBorrowSpeed(address,uint64)
- Arguments
{ "0": "0xc3d688B66703497DAA19211EEdff47f25384cdc3", "1": "1157407407407" }- Calldata
- Target
- 0x1ec6…8779
- Value
- 0 wei
- Function
- deployAndUpgradeTo(address,address)
- Arguments
{ "0": "0x316f9708bB98af7dA9c68C1C3b5e79039cD336E3", "1": "0xc3d688B66703497DAA19211EEdff47f25384cdc3" }- Calldata
05Tally
Summed from votes
06Voters
| Voter | Choice | % of total | Rationale | ||
|---|---|---|---|---|---|
| EA0xea6c…3bf7 | For | 331K | 59.05% | — | 3y ago |
| B90xb933…8dd1 | For | 53.9K | 9.62% | — | 3y ago |
| B40xb49f…7948 | For | 50K | 8.92% | — | 3y ago |
| 070x0703…961b | For | 50K | 8.92% | — | 3y ago |
| 130x13bd…8548 | For | 50K | 8.92% | — | 3y ago |
| 3F0x3fb1…4c8a | For | 25.6K | 4.56% | — | 3y ago |
| E40xe459…e666 | For | 0.7 | 0.00% | — | 3y ago |
| C30xc34a…68c2 | For | 0.7 | 0.00% | — | 3y ago |
07Forum
- [Gauntlet] Ethereum v3 USDC Reward Recommendations (12/6/23) ↗discourse · high confidence
Arguments for
- Reducing COMP rewards extends the runway of remaining COMP tokens and moves toward protocol sustainability by focusing rewards on initial comet growth rather than indefinite user retention.— Gauntlet
- Ethereum v3 USDC has reached sufficient maturity with $376M supply and $360M borrows, making it appropriate to begin gradual reward reduction.— Gauntlet
- The proposed borrow reward reduction maintains competitive Net Borrow APR of 3.68%, still below prevailing market risk-free rates, preserving borrower value.— Gauntlet
- High utilization consistently at or above the 93% kink demonstrates strong organic demand, indicating the market can sustain lower reward levels.— Gauntlet
Arguments against
None surfaced.
Notable participants
- GauntletProposer and primary advocate presenting the reward reduction analysis, rationale, and implementation plan.
- 0xJMGCommunity supporter who endorsed the proposal while suggesting alternative revenue-generation approaches for long-term sustainability.
Generated by Kvorum
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