VELO-USDC.e pool is effectively deprecated but has about $8mm TVL on it, the vast majority of the pool on Velodrome. This pool is currently larger than the pool actually earning a return, VELO-USDC.
LPs on the USDC.E pool want to unwind (being unable to generate much APR) but aren't going to be able to maintain their positioning without enough capacity on the USDC pool (which is currently maxed).
Replicating the borrow capacity on the USDC.e pool and applying it to the USDC pool would allow for an easy transition and functional sunsetting of USDC.e, which is something that is good for the ecosystem and LPs as we broadly move onto native USDC.
In the meantime, VELO has by far the most liquidity on this platform and is poised to generate more demand for liquidity as Velodrome expands crosschain. Increasing the USDC credit limit of the dex's central token to 10mm would provide enough headroom for this expansion and hasten the move away from USDC.E.