Author

Chaos Labs, desnake

Overview

Chaos Labs supports listing wstETH as a borrowable asset pool on Gearbox’s Ethereum deployment. In the following analysis, we will cover wstETH as a borrowable asset and Mellow LRTs, including DVstETH initial listing parameters. Below is our analysis and initial risk parameter recommendations.

Motivation

The creation of a wstETH pool on Gearbox, enabling wstETH to be borrowable, addresses a critical need for liquidity in the ecosystem. With the growing number of recently listed assets on Gearbox being backed by wstETH, such as those in the Mellow Protocol (examples include Re7LRT, rstETH, steakLRT, and amphrETH), this pool provides a direct source of liquidity for looping strategies without introducing additional correlation risk. These assets rely heavily on wstETH as collateral, and by enabling borrowing, the pool will facilitate leveraged strategies for users aiming to farm Mellow and Symbiotic points effectively. This, in turn, will generate increased demand for wstETH liquidity while offering additional yield opportunities for Gearbox depositors.

Technical specification

Price oracle

• wstETH (0x7f39c581f595b53c5cb19bd0b3f8da6c935e2ca0)

  • Main: wstETH/stETH exchange rate * ETH/USD Chainlink (already live at 0x3cC17FF3CA71Ebf43bF108336cC9158995f0c51B)
    • Trusted: True

• rstETH (0x7a4EffD87C2f3C55CA251080b1343b605f327E3a)

  • Main: ERC4626 oracle of 0x7a4EffD87C2f3C55CA251080b1343b605f327E3a using existing "Main wstETH" (0x3cC17FF3CA71Ebf43bF108336cC9158995f0c51B) as underlying
  • Reserve: Redstone wstETH/USD (https://app.redstone.finance/app/token/wstETH/)

• DVstETH (0x5E362eb2c0706Bd1d134689eC75176018385430B)

  • Main: Mellow vault exchange rate (Mellow priceOracle address: https://etherscan.io/address/0x39D5F9aEbBEcba99ED5d707b11d790387B5acB63) (need to deploy)
  • Reserve: Redstone wstETH/USD (https://app.redstone.finance/app/token/wstETH/)

Compatibility (Zero price feed):

• amphrETH (0x5fD13359Ba15A84B76f7F87568309040176167cd)
• Re7LRT (0x0f70443c26cfa299BF62adE49b5a3F8d49DABb46)
• steakLRT (0xBEEF69Ac7870777598A04B2bd4771c71212E6aBc)
• waEthLidowstETH (0x775f661b0bd1739349b9a2a3ef60be277c5d2d29)
• Balancer v3 wstETH/rstETH (0x121edb0badc036f5fc610d015ee14093c142313b)
• Balancer v3 DVstETH/rstETH (0xeb95d6bd67f613e7918a031d9f4a9a92766659ac)

wstETH pool

Pool parameters

Parameter	Value
symbol	dWSTETHV3
name	wstETH v3
underlying	wstETH
accountAmount	100,000
totalDebtLimit	30,000

Farming contract & corresponding zappers: Not required.

IRM

Parameter	Proposed value
r0	0%
r1	0.2%
r2	0.5%
r3	30
U1	70
U2	90
isBorrowingMoreU2Forbidden	true

Quoted tokens

Asset	DVstETH	rstETH
Quota Limit	1400	2400
minRate	0.01%	0.01%
maxRate	0.01%	0.01%

Compatibility (quotaLimit: 0; minRate: 0.01%; maxRate: 0.01%):

• amphrETH (0x5fD13359Ba15A84B76f7F87568309040176167cd)
• Re7LRT (0x0f70443c26cfa299BF62adE49b5a3F8d49DABb46)
• steakLRT (0xBEEF69Ac7870777598A04B2bd4771c71212E6aBc)
• waEthLidowstETH (0x775f661b0bd1739349b9a2a3ef60be277c5d2d29)
• Balancer v3 wstETH/rstETH (0x121edb0badc036f5fc610d015ee14093c142313b)
• Balancer v3 DVstETH/rstETH (0xeb95d6bd67f613e7918a031d9f4a9a92766659ac)

Credit Managers

wstETH Correlated Tier 1

Parameter	Value
minDebt	50
maxDebt	1000
feeInterest	0.25
feeLiquidation	0.002
liquidationPremium	0.02
feeLiquidationExpired	0.002
liquidationPremiumExpired	0.02
poolLimit	50000

Collateral tokens

Token	rstETH	DVstETH
LT	0.95	0.93

Compatibility (LT: 0):

• amphrETH (0x5fD13359Ba15A84B76f7F87568309040176167cd)
• Re7LRT (0x0f70443c26cfa299BF62adE49b5a3F8d49DABb46)
• steakLRT (0xBEEF69Ac7870777598A04B2bd4771c71212E6aBc)
• waEthLidowstETH (0x775f661b0bd1739349b9a2a3ef60be277c5d2d29)
• Balancer v3 wstETH/rstETH (0x121edb0badc036f5fc610d015ee14093c142313b)
• Balancer v3 DVstETH/rstETH (0xeb95d6bd67f613e7918a031d9f4a9a92766659ac)

Adapters:

• ERC4626 deposit:
  • waEthLidowstETH (0x775F661b0bD1739349b9A2A3EF60be277c5d2D29)
• Balancer v3
  • wstETH/rstETH (0x121edb0badc036f5fc610d015ee14093c142313b)
  • DVstETH/rstETH (0xeb95d6bd67f613e7918a031d9f4a9a92766659ac)
• Mellow vault deposits:
  • rstETH (0x7a4EffD87C2f3C55CA251080b1343b605f327E3a)

wstETH Correlated Tier 2

Parameter	Value
minDebt	10
maxDebt	200
feeInterest	0.25
feeLiquidation	0.003
liquidationPremium	0.03
feeLiquidationExpired	0.003
liquidationPremiumExpired	0.03
poolLimit	20000

Collateral tokens

Token	rstETH	DVstETH
LT	0.95	0.93

Compatibility (LT: 0):

• amphrETH (0x5fD13359Ba15A84B76f7F87568309040176167cd)
• Re7LRT (0x0f70443c26cfa299BF62adE49b5a3F8d49DABb46)
• steakLRT (0xBEEF69Ac7870777598A04B2bd4771c71212E6aBc)
• waEthLidowstETH (0x775f661b0bd1739349b9a2a3ef60be277c5d2d29)
• Balancer v3 wstETH/rstETH (0x121edb0badc036f5fc610d015ee14093c142313b)
• Balancer v3 DVstETH/rstETH (0xeb95d6bd67f613e7918a031d9f4a9a92766659ac)

Adapters:

• ERC4626 deposit:
  • waEthLidowstETH (0x775F661b0bD1739349b9A2A3EF60be277c5d2D29)
• Balancer v3
  • wstETH/rstETH (0x121edb0badc036f5fc610d015ee14093c142313b)
  • DVstETH/rstETH (0xeb95d6bd67f613e7918a031d9f4a9a92766659ac)
• Mellow vault deposits:
  • rstETH (0x7a4EffD87C2f3C55CA251080b1343b605f327E3a)

Partial liquidation bot

Give PLB of address 0x0f06c2bD612Ee7D52d4bC76Ce3BD7E95247AF2a9 permissions to add collateral, decrease debt and withdraw collateral in "wstETH Correlated Tier 1" and "wstETH Correlated Tier 2" CM.

Transaction log

Txn log can be found here Md5 checksum is 81fcab18c0fbe7916c43d61221333d7f