BIP#44: Lower ETH Pool’s Base Rate and Protocol Admin Fee

Background

As established in BIP#39, the current base rate of the ETH pool stands at 15%. For additional information, please refer to our Interest Rate Model.

The protocol admin fee is a portion of the total interest income collected on NFT loans. For more details, please see the documentation.

Summary

This proposal aims to adjust the base rate of the ETH pool and the protocol admin fee, positioning BendDAO more favorably in the NFTFi competitive landscape. By offering more attractive rates, the goal is to increase the BendDAO user base, enhance liquidity, and foster sustainable growth of the protocol.

Specification & Motivation

Responding to evolving market dynamics and aiming to maintain BendDAO's competitive edge in the NFTFi sector, this proposal suggests two key adjustments:

• Lower the ETH Interest Rate Curve Base Rate from 15% to 12%

Competitive Rates for Borrowers: Reducing the base rate will provide more competitive borrowing rates, anticipated to attract a larger pool of borrowers to BendDAO.

• Decrease the Protocol Admin Fee by 5%

Competitive Rates for ETH Suppliers: In an effort to remain competitive and attractive to ETH suppliers, the proposal recommends reducing the protocol admin fee from the current 30% to 25%.

Increased Liquidity: This increase in borrow/lend activity is expected to boost the Total Value Locked (TVL) within BendDAO, thus enhancing the overall health and stability of the protocol.

On-chain voting

Voting Quorum: Approximately 43M veBEND (10% of the total supply) Pass Rate: Over 80% Approve. The voting will last for 3 days.