Summary
This proposal recommends formally sunsetting five inactive or redundant FiRM markets by setting their market ceilings to 0 and pausing new borrows. The markets targeted for deprecation are: DAI, FRAX, COMP, yv-DOLA/crvUSD LP, and DOLA/crvUSD LP. These markets exhibit negligible usage, no longer align with strategic collateral objectives, and require ongoing monitoring disproportionate to their future utility. This cleanup effort is part of a broader initiative to reduce overhead and concentrate risk oversight on FiRM’s most productive markets.
Motivation
As FiRM matures, periodic reviews of its supported collateral markets are essential to maintaining a healthy, efficient lending protocol. Several of FiRM’s earliest markets were launched during periods of experimentation or opportunistic integration and have since seen their relevance diminish. In some cases, the underlying assets have been deprecated or superseded by newer mechanisms; in others, anticipated ecosystem partnerships failed to materialize.
Sunsetting unused or low-utility markets serves multiple objectives. It removes operational overhead from the RWG, reduces the monitoring burden for oracles and liquidity, and minimizes governance surface area around parameters that no longer require tuning. From a security perspective, deprecating dormant markets also narrows the protocol’s exposure to tail risks, such as flash liquidity drains, mispriced feeds, or liquidations in low-liquidity and/or high-gas environments.
By formally winding down these markets, we reinforce our commitment to good protocol hygiene and signal to external partners and users that FiRM collateral is thoughtfully curated and regularly maintained.
Background & Rationale
DAI
The DAI FiRM market was originally introduced to support users leveraging the DAI Savings Rate (DSR) for fixed-rate borrowing. However, since MakerDAO’s rebrand to Sky and strategic pivot toward its new USDS stablecoin, DAI’s incentive structure is steadily eroding. Given that the DOLA/sUSDS LP is already supported as collateral, the DAI market is now redundant and unnecessary to maintain.
FRAX
Frax Finance has officially “upgraded” the FRAX stablecoin to frxUSD, its new flagship asset for algorithmic stability and RWA integration. While 1:1 swapping between the two will be available for some time, liquidity, incentivization, and management for the old FRAX contract will inevitably trend to 0.
COMP
The COMP market was initially launched with the potential for strategic alignment with the Compound ecosystem. However, those plans never advanced into actionable integrations, and market activity has remained near-zero for most of its lifecycle. Compounding the issue, on-chain liquidity for COMP has thinned considerably, making it a less reliable asset for collateralized borrowing. Continuing to monitor and support this market offers little upside and introduces maintenance risk, making deprecation the prudent choice.
DOLA/crvUSD LP & yv-DOLA/crvUSD LP
The base DOLA/crvUSD LP markets have become functionally obsolete following the TWG’s decision to shift incentives toward DOLA pools on Curve paired with yield-bearing stablecoins. The sDOLA/crvUSD and sDOLA/scrvUSD LPs now represent the preferred markets. Sunsetting this market removes redundancy and supports the consolidation of DOLA liquidity around more strategic pool compositions.
On-Chain Actions
For each market listed:
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setMarketCeiling = 0
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pauseBorrows = true
This ensures no new borrowing can occur while still allowing existing borrowers (if any) to repay their loans and exit gracefully.