Summary

This proposal aims to reduce the Minimum Collateral Ratio (MCR) for the Classic section of Lista DAO’s borrowing platform. The primary objective is to lower the MCR for specific collateral types in order to increase the Loan-to-Value (LTV) ratio to provide users with a better borrowing experience and align the platform with current market conditions.

Abstract

The proposal outlines three key adjustments. First, the MCR will be reduced for specific assets to enhance the borrowing capacity of users. Second, the LTV for collateral assets will be increased accordingly to match the new MCR values. Third, this adjustment is only for the Classic section, allowing a more competitive experience for users. A detailed breakdown of the new MCR values for each collateral type will be provided, reflecting the necessary updates to the relevant smart contracts and front-end interfaces.

Motivation

Improved User Experience

• Current Problem: The existing MCR for certain assets is too high, limiting the borrowing potential of users. This can lead to reduced borrowing activity and lower platform engagement.
• Proposed Solution: By lowering the MCR and increasing the LTV for key collateral types, the platform will offer users greater borrowing flexibility while maintaining security.

Competitiveness in DeFi

• Market Comparison: We analyzed comparable platforms such as Aave and Venus, both of which offer higher LTVs for similar collateral. Adjusting the MCR will make Lista DAO more competitive in the DeFi lending space.

Specification

MCR Adjustment for Classic Collaterals

This proposal will only adjust the MCR for the Classic section’s collateral assets, as outlined below:

No.	Collateral	New LTV	New MCR
1	BNB	83.33%	120%
2	slisBNB	80%	125%
3	ETH	80%	125%
4	wBETH	80%	125%
5	BTCB	80%	125%
6	wstETH	76.92%	130%

Justification for Changes:

• BNB: BNB has the best liquidity on BSC, so it will benefit from the lowest MCR of 120%.
• slisBNB, ETH, wBETH, BTCB: These assets have strong liquidity and are widely used across DeFi platforms, so their MCR will be adjusted to 125%.
• wstETH: While wstETH is popular, its liquidity on BSC is not as robust, so it will have a slightly higher MCR of 130%.

The new MCR values have been determined based on liquidity and market demand for each asset. In particular, we aim to align with Venus’ rates for most assets to remain competitive.

Benefits (Pros)

1. Increased Borrowing Capacity: Users will be able to borrow more against their collateral with a higher LTV, improving capital efficiency.
2. Better User Experience: Lower MCRs provide users with more flexibility and a less restrictive borrowing environment, potentially increasing engagement.
3. Market Competitiveness: By aligning our MCR values with other major platforms, such as Venus, Lista DAO will stay competitive in attracting users in the DeFi space.

Downsides (Cons)

• Increased Risk: Lowering the MCR could introduce more risk to the platform, as users can borrow more relative to their collateral. However, this risk can be managed with continuous monitoring of market conditions and liquidation parameters.

Voting

• Yes: Approve the proposed MCR adjustments for the Classic section, lowering the MCR and increasing LTV for the listed collateral assets.
• No: Reject the proposal and maintain the current MCR values for the Classic section.

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Collateral MCR Adjustment

1. Collateral Categorization and Adjustments: The Classic section’s collateral assets will be adjusted based on liquidity and market demand. The proposed changes are as follows:

• BNB: New MCR of 120%, LTV of 83.33%.
• slisBNB, ETH, wBETH, BTCB: New MCR of 125%, LTV of 80%.
• wstETH: New MCR of 130%, LTV of 76.92%.

This adjustment will enhance borrowing capacity while maintaining risk management. If any future changes are necessary due to market fluctuations, additional proposals will be submitted.