Overview
Chaos Labs supports listing EURC. Our analysis and risk parameter recommendations for the initial listing are below.
Liquidity and Market Cap
When evaluating assets for listing, we review market cap and trading volume data from the past 180 days. The average market cap of EURC over the past 180 days was ~$50.07M, and the average daily trading volume was ~$2.36M (CeFi & DeFi).
Since its launch on Base in early August, EURC’s on-chain DEX liquidity has steadily grown to a current value of ~$9M.
Liquidation Threshold
Analyzing EURC price volatility over the past 180 days, we observed a daily annualized volatility of 6.99% and a 30-day annualized volatility of 6.07% relative to USD. The largest price drop during this period was 1.25%.
Given EURC’s volatility, relatively small market cap, and limited but increasing liquidity, we recommend listing it with more conservative parameters compared to other stablecoins on Seamless. Specifically, we propose a Liquidation Threshold of 70%. We will continue monitoring EURC’s usage and reassess this decision after the launch if needed.
Supply Cap, Borrow Cap, and Liquidation Bonus
Following Chaos Labs’ approach to initial supply caps, we propose setting the Supply Cap at 2x the liquidity available under the Liquidation Penalty price impact.
Given EURC’s on-chain liquidity, we recommend a 7.5% Liquidation Bonus, a supply cap of 3,000,000 EURC, and a borrow cap of 2,700,000 EURC.
IR Curve
We recommend setting the interest rate parameters in line with those of stablecoins.
Recommendation
Following the above analysis, we recommend listing EURC with the following parameter settings:
| Parameter | Value |
|---|---|
| Isolation Mode | No |
| Borrowable | Yes |
| Collateral Enabled | Yes |
| Supply Cap | 3,000,000 |
| Borrow Cap | 2,700,000 |
| Debt Ceiling | - |
| LTV | 65.00% |
| LT | 70.00% |
| Liquidation Bonus | 7.50% |
| Liquidation Protocol Fee | 10.00% |
| Reserve Factor | 20.00% |
| Variable Base | 0.00% |
| Variable Slope1 | 7.00% |
| Variable Slope2 | 75.00% |
| Uoptimal | 90.00% |