BIP#9 Adjusting Liquidation Threshold, Auction Period, and Interest Base Rate & Removing the first bid limitation

Summary

We are sorry that we underestimated how illiquid NFTs could be in a bear market when setting the initial parameters. In the past several days, we got tons of feedback and suggestions from the community (BIP#8 Changing Lending Parameters). After a comprehensive review and discussion, it’s time to make a proposal to help ETH depositors to build confidence. To achieve that, we would like to do the following for the community to review.

SPECIFICATION

Protocol short-term parameter improvement (It will be effective immediately if the proposal can pass the community voting):

• Adjust the Liquidation Threshold to 70% as follows:
  • update to 85% August 30th, 12 pm UTC
  • update to 80% September 6th, 12 pm UTC
  • update to 75% September 13th, 12 pm UTC
  • update to 70% September 20th, 12 pm UTC
• Adjust the Auction Period to 4 hours
• The 48-hour window is designed to protect NFT holders to avoid liquidation without waking up and losing their PFP. But right now we have TWAP protection of Oracle on-chain which means floor price attack would be very difficult. So we would like to reduce the period from 48 hours to 4 hours to improve liquidity for auctions.
• Remove the first bid limitation of 95% of the floor price It will limit the auction competitors.
• Adjust Interest Interest Base Rate to 20% It would help more ETH depositors earn more interest and prompt more NFT holders to repay ETH.

All BEND stakers are members of BendDAO.

Voting Quorum: 47M veBEND (20% of the total supply) Pass Rate: Over 75% Approve. The voting will last for 24 hours.