[Proposal] Raise bETH LTV to 75%

That would work. I think Friday is fine to queue them in. Looks like we might already have some research to answer questions.

As proposed above by @atebites and by many people in the community lately, raising the max bETH LTV will increase collateral capital efficiency. This was decided against during the bLUNA vote because the data wasn’t compelling data to override the possible risks. However, bLUNA has sustainably grown over 3x since that time and continues to be a larger part of the collateral base.

The major risk is the depth of the bids in the liquidation queue, meaning the more bids, the shallower the premium and less risk of insolvency. The substantial growth of the bETH supply has helped build liquidation depth to the queue. If we look at the liquidation queue premiums since Oct of last year, which includes the Dec & Feb deep pullbacks - we can see the bETH supply actually grew and liquidation premiums tightened substantially limiting risk.

Liquidation premiums (exponentially smoothed):

Therefore moving forward with the recommendations of many community members to increase bETH is highly recommended to further increase its capital efficiency and revenue to the protocol.

75% LTV seems like the reasonable level to set it at without taking on too much risk.

3 Likes

It seems like an easier and more efficient proposal than increasing the number of borrowers.

75%. Agree.

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yep, and frankly a lot of borrowers have loads of excess capital they would love to get more ust for. This is just another tool to get us to xAnchor and veANC. I have all the confidence we’ll see a sustained high APY for depositors in time as we increase their ability to utilize their capital assets.

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Totally agree with @bitn8. The recent increase and continuous inflow of bETH shows evidence that we can support a higher LTV. This will bring even more capital since most Money Markets are in the range of 70-80% LTV for ETH and we would be competitive. We will probably see a nice increase on the borrow side of things too, actively increasing overall health of Anchor.

I was always on the fence to deposit more ETH due to the competition of incentivized Money markets with higher LTV ratios. I don’t see any disadvantages with a potential veANC model, higher LTV and the terra ecosystem in general

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Yes. Regardless of dynamic earn rate. Unless a collaterall is deeply suspect they should all have 75% plus. 100% even. If the collaterall is provided in a smart contract it is there and it is good to be borrowed against and liquidated if need be.

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Looks like prop 20 passed guys we should get this rolled out right away as well to further help with borrowing.

So far doesn’t look like anyone is against it but not a lot of interest so let’s get those votes on the poll!

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When proposal dynamic earn rate passed, the income of anchor protocol is much critical. This proposal could raise the revenue of anchor protocol indeed. It should pass ASAP

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I will support this proposal

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Fully support - good upside with very minimal risk.

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This is great. Would love to see a higher bETH LTV cap. That being said, xAnchor is adding bETH right? Are you assuming it’s fine to just watch sAVAX and other things being added as a metric to tell if that’ll break the current bETH system when it goes crosschain?

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From my understanding savax is under xanchor, ui still reports legacy im sure the team is crazy busy with cross chain and what not. 80% will remain for Beth the liquidity is present. I believe both bluna and Beth are being reworked for xanchor anyways so there won’t be too much to change / worry about once xanchor is live.

We’re nearing 50 polls guys keep it up let’s get this live!

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If LTV changes to 75%, I will move my ETH from AAVE on Polygon over to Anchor (it’s 80% LTV over there).

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I am waiting for your tx hash :wink:

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I just threw my anchor on edge to buy some gohm since I caught wind Olympus and Anchor are in talks rn lmao. Looks like teams got me on this one.

Need this ASAP! I’ll move all my ETH from Aave into Anchor.

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Hey guys, looks like poll passed 50 and batom is moving strong. I’ll roll this prop out today for everyone to vote on!!

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Way for this as ETH is about as trusted an asset one can get these days anyway. Exluding it from higher ltvs is a bar set too high :stuck_out_tongue:

Hey, sorry guys just having a bit of difficulting getting my Anchor to be recognized to submit the poll. you’ll have to give me a bit more time here.

Can someone see if they are able to poll for this I’ve tried multiple devices I’m unable to get it running. Will submit bug report on git.