YPP-0106.md

Proposal

Lower the dust levels for USDT on Arbitrum

Background

The dust (min debt) level for USDT borrowing is set to 1000 (USD VALUE) currently, which now too high to incentivize smaller vaults.

Details

The updateLimits.ts script will be used, with this input:

const ilkUSDTUSDT: Ilk = {
  baseId: USDT,
  ilkId: USDT,
  asset: {
    assetId: USDT,
    address: assets.getOrThrow(USDT)!,
  },
  collateralization: {
    baseId: USDT,
    ilkId: USDT,
    oracle: protocol.getOrThrow(CHAINLINKUSD)!,
    ratio: 1000000,
  },
  debtLimits: {
    baseId: USDT,
    ilkId: USDT,
    line: 100000000,
    dust: 0,
    dec: 6,
  },
  // No auction line and limit for USDT/USDT
}
const ilkUSDTETH: Ilk = {
  baseId: USDT,
  ilkId: ETH,
  asset: {
    assetId: ETH,
    address: assets.getOrThrow(ETH)!,
  },
  collateralization: {
    baseId: USDT,
    ilkId: ETH,
    oracle: protocol.getOrThrow(CHAINLINKUSD)!,
    ratio: 1400000,
  },
  debtLimits: {
    baseId: USDT,
    ilkId: ETH,
    line: 100000,
    dust: 100,
    dec: 6,
  },
  auctionLineAndLimit: {
    baseId: USDT,
    ilkId: ETH,
    duration: 3600,
    vaultProportion: WAD.div(2),
    collateralProportion: WAD.mul(1050000).div(1400000),
    max: WAD.mul(1000), // $10M
  },
}
const ilkUSDTDAI: Ilk = {
  baseId: USDT,
  ilkId: DAI,
  asset: {
    assetId: DAI,
    address: assets.getOrThrow(DAI)!,
  },
  collateralization: {
    baseId: USDT,
    ilkId: DAI,
    oracle: protocol.getOrThrow(CHAINLINKUSD)!,
    ratio: 1100000,
  },
  debtLimits: {
    baseId: USDT,
    ilkId: DAI,
    line: 100000,
    dust: 100,
    dec: 6,
  },
  auctionLineAndLimit: {
    baseId: USDT,
    ilkId: DAI,
    duration: 3600,
    vaultProportion: WAD,
    collateralProportion: WAD.mul(1050000).div(1100000),
    max: WAD.mul(10000000),
  },
}
const ilkUSDTUSDC: Ilk = {
  baseId: USDT,
  ilkId: USDC,
  asset: {
    assetId: USDC,
    address: assets.getOrThrow(USDC)!,
  },
  collateralization: {
    baseId: USDT,
    ilkId: USDC,
    oracle: protocol.getOrThrow(CHAINLINKUSD)!,
    ratio: 1100000,
  },
  debtLimits: {
    baseId: USDT,
    ilkId: USDC,
    line: 100000,
    dust: 100,
    dec: 6,
  },
  auctionLineAndLimit: {
    baseId: USDT,
    ilkId: USDC,
    duration: 3600,
    vaultProportion: WAD,
    collateralProportion: WAD.mul(1050000).div(1100000),
    max: ONEUSDT.mul(10000000),
  },
}

Testing

Manual verification of state changes on this tenderly fork.