Overview
A proposal to:
- Increase supply and borrow caps for USDC
The recommendations below were made utilizing Chaos Labs’ supply and borrow cap methodologies and after analyzing user positions for each asset.
Analysis
The supply cap and borrow cap for USDC on Base are currently at 85% and 88% utilization.
Supply & Borrow Distribution
The USDC pool has quickly filled up after the recent borrow and supply cap increases recommended on 4/10/24. Given that the supply and borrow patterns for USDC have been consistent and are primarily concentrated in a single wallet, along with a few accounts supplying USDC and WETH and borrowing USDC, we do not perceive any additional risk and thus support increasing the supply and borrow caps further.
Additionally, we have observed sufficient liquidity of USDC on Base to support our recommendation to increase the supply and borrow caps.
Recommendations
| Asset | Current Supply Cap | Recommended Supply Cap | Current Borrow Cap | Recommended Borrow Cap |
|---|---|---|---|---|
| USDC | 32,000,000 | 48,000,000 | 24,000,000 | 36,000,000 |