Background
Since its inception, FiRM has been operating in a “guarded mode,” with limited amounts of DOLA available to borrow in the active markets. Periodically, the RWG proposes parameter adjustments to existing markets to create a more attractive platform. Proposed changes might include adjustments in collateral factors, daily borrow limits, liquidation factors, and market supply ceilings, evaluated by the RWG to attract new users whilst still maintaining stability and security of the platform.
Risk Assessment
Parameter recommendations for new markets and changes to existing markets on FiRM are the end result of RWG “Risk Assessments”. Refer to this document here for a summary of the latest assessment performed on the CRV and cvxCRV markets backing the recommended parameter changes presented in the Overview section below.
Overview
Based on the analysis conducted, it is concluded that increasing the market ceiling to $6,000,000 and the daily borrow limit to $500,000 for the cvxCRV market is justifiable. The analysis of slippage and price impact figures indicates sufficient liquidity and market depth to support higher borrowing limits. While cvxCRV exhibits weaknesses in DEX trading volume, price volatility, and token distribution, the strong market capitalization and token utility scores suggest a market demand for cvxCRV.
At the same time, it is also concluded that increasing the market ceiling to $10,000,000 and the daily borrow limit to $1,000,000 for the CRV market is justifiable. The analysis of slippage and price impact figures indicates sufficient liquidity and market depth to support higher borrowing limits. The strong total utility score (TUS) for CRV further validates the market’s confidence and demand for borrowing CRV.
On-Chain Actions
CRV Market
- Set FiRMCRVMarket Daily Borrow Limit to 1,000,000 DOLA
- Set FiRMCRVMarket Supply Ceiling to 10,000,000 DOLA
cvxCRV Market
- Set FiRMcvxCRVMarket Daily Borrow Limit to 500,000 DOLA
- Set FiRMcvxCRVMarket Supply Ceiling to 6,000,000 DOLA
FiRM
- Set FiRM’s Global Supply Ceiling to 31,000,000 DOLA