Readjust Market Borrow Limits

Proposals
1

Summary

This proposal seeks to remove underutilized markets and readjust borrow caps on existing markets to optimize protocol efficiency. The changes focus on maintaining markets that create strategic synergies with Resupply while removing those with low utilization and limited protocol value.

Motivation

Synergy-Focused Market Strategy

Markets with yield-bearing stables should be added or removed based on the synergies they create with Resupply. This approach ensures that protocol resources are allocated to markets that provide tangible benefits beyond simple lending activity.

Current Market Synergy Analysis

Markets with Strong Synergies:

scrvUSD:

  • Crv gauges available for liquidity pool incentives

  • Direct lending integration to sreUSD market

  • Strong alignment with Curve ecosystem

sfrxUSD:

  • Algorithmic Market Operations liquidity pooling opportunities

  • Established liquidity partnerships

  • Core stable asset for protocol operations

sDOLA:

  • Leverage liquidity pool options (prospective in near future)

  • Growing DeFi integration potential

fxSAVE (fxUSD):

  • FX gauge available for liquidity pool incentives

  • FX Protocol ecosystem alignment

Markets with Limited or No Synergies:

sUSDS:

  • No identified synergies

  • Low market demand

USDe:

  • No identified synergies

  • Low demand compared to sUSDe alternative

sUSDe:

  • No identified synergies

  • Good demand but lacks strategic value-add

Rationale for Market Adjustments

By focusing on synergy-based markets, Resupply can:

  • Concentrate liquidity where it creates the most protocol value

  • Reduce operational overhead from maintaining underutilized markets

  • Strengthen partnerships with aligned DeFi protocols

  • Improve capital efficiency across the platform

Specification

Reduce Borrow Caps on Low Utilization Markets

The following markets will have their borrow limits reduced or eliminated due to low utilization and lack of strategic synergies:

Set Borrow Limit on tbtc to 0

  • Reason: Underutilized market with no strategic synergies

Set Borrow Limit on USDe to 0

  • Reason: Low demand, especially compared to sUSDe alternative

Set Borrow Limit on sUSDS to 0

  • Reason: Low utilization and no identified synergies

Set Borrow Limit on sDOLA (old) to 0

  • Reason: Deprecated version, replaced by current sDOLA market

Increase Borrow Cap on High-Synergy Market

Set Borrow Limit on fxSAVE to 25m (up from 10m)

  • Reason: Strong synergies through FX gauge liquidity pool incentives

  • Current utilization supports increased capacity

  • FX Protocol ecosystem alignment provides strategic value

2 Likes
2

Offboarding USDS seems wise. They are having liquidity troubles I think.