KVORUM
compoundSource: Compound governor oz · #588

Optimism USDC and USDT IRM Updates

executedJun 28, 2026, 05:53 AM UTCby7B0x7b3c…cc33

01Summary

AISummary by Kvorumclaude-haiku-4-5

Gauntlet proposes updating the interest rate model (IRM) for Optimism USDC and USDT markets by increasing the borrow rate base from 1.5% to 3.0% and flattening the borrow slope below kink. This shifts protocol revenue from liquidation income toward interest income and reduces reserve depletion at typical utilization levels. Supply-side parameters remain unchanged. This is a scoped experiment on these two Optimism assets only.

Type
parameter change

Key changes

  • Increase borrow_per_year_interest_rate_base from 1.50% to 3.00% on Optimism USDC comet(high)
  • Decrease borrow_per_year_interest_rate_slope_low from 0.0278 to 0.011111 on Optimism USDC comet(high)
  • Increase borrow_per_year_interest_rate_base from 1.50% to 3.00% on Optimism USDT comet(high)
  • Decrease borrow_per_year_interest_rate_slope_low from 0.0278 to 0.011111 on Optimism USDT comet(high)
  • Supply-side parameters held constant on both markets(low)

Notable concerns

  • This is a scoped experiment; broader market impacts beyond Optimism USDC and USDT unknown
  • Revenue shift from liquidation to interest income changes protocol economics
Contracts0x2e44e174f7d53f0212823acc11c01a11d58c5bcb0x995e394b8b2437ac8ce61ee0bc610d617962b214
Generated by Kvorum
model: claude-haiku-4-5
provider: anthropic
profile: anthropic-fast-v1
prompt: v1.0
generated: 2mo ago
Read the description ↗

02Description

180 words

Optimism USDC and USDT IRM Updates

Summary

Gauntlet recommends an update to the interest rate model (IRM) on the Optimism USDC and USDT comets. The change raises the borrow rate base from 1.5% to 3.0% and flattens the borrow slope below kink, while leaving the supply curve, kink, and high-utilization slope unchanged. This is a deliberate realignment of the revenue mix: it shifts protocol earnings toward interest income and away from reliance on liquidation revenue, and it sharply reduces reserve depletion at the mid-range utilization where these markets spend most of their time.

We are proposing this as a scoped experiment on the Optimism USDC and USDT comets.

Recommended parameter changes

Applied to the Optimism USDC and USDT comets:

ParameterCurrentRecommended
borrow_per_year_interest_rate_base1.50%3.00%
borrow_per_year_interest_rate_slope_low0.02780.011111

The supply side is held entirely constant. The entire effect of this proposal comes from the borrow curve below the kink.

More details about the proposal can be found here

03Mismatch analysis

AIMismatch analysis by Kvorum

A calldata-vs-description analysis is not generated yet. Review the decoded actions →

04Actions

1 total
#0sendMessage(address,bytes,uint32)chain 0x1
Target
0x25ac…5fa1
Value
0 wei
Function
sendMessage(address,bytes,uint32)
Arguments
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Calldata

05Tally

Summed from votes

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Outcome (current)—
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06Voters

0 total

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07Forum

AIForum synthesis by Kvorumclaude-sonnet-5
sentiment · favorablethread · constructive

Arguments for

  • The current IRM causes reserve depletion across a wide mid-range utilization band (until ~76% utilization), making the protocol overly reliant on liquidation revenue rather than interest income.— Gauntlet
  • Raising the borrow rate base to 3.0% and flattening the slope below the kink shifts break-even utilization down to ~54% and reduces worst-case reserve drag by roughly 80%.— Gauntlet
  • The supply curve, kink, and high-utilization slope remain unchanged, so suppliers are unaffected and high-utilization borrower behavior is unchanged, isolating the fix to the problematic mid-range.— Gauntlet
  • The change is scoped as a reversible, monitored experiment (8-week reserve and churn monitor) on only two comets, limiting risk while testing the model.— Gauntlet
  • Post-execution data showed encouraging results: reserve depletion stopped entirely and reserve accumulation increased in both comets, supporting extension of the approach to other low-utilization comets.— Gauntlet

Arguments against

None surfaced.

Unresolved concerns

  • Higher base rates could discourage low-utilization borrowing and cause borrowers to migrate elsewhere, partially offsetting the reserve benefit ('churn sensitivity' not fully resolved at proposal time).— Gauntlet
  • The flatter, slower rate adjustment could introduce asymmetric responsiveness to utilization moves in either direction, which had not been confirmed as balanced under realistic flow.— Gauntlet

Notable participants

  • GauntletProposer who authored the IRM update, published the on-chain proposal, and later reported post-execution monitoring results.
Generated by Kvorum
model: claude-sonnet-5
provider: anthropic
profile: anthropic-strong-v1
prompt: v1.0
generated: 2mo ago
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