MIR-48.1┃Choose osETH collateral parameters for PAR on Ethereum

Summary:

This proposal aims to set osETH parameters for PAR collateral on Ethereum.

Rationale:

With the recent vote in favor of integrating osETH as new PAR collateral on Ethereum, the DAO needs to set the different parameters of this collateral.

We propose :

• Minimum Collateral Ratio (%): 130
• Liquidation Ratio (%): 125
• Liquidation Bonus (%): 8
• Debt Limit ($): 100,000
• Initiation Fee (%): 0.20
• Borrow Fee (%/y): decided by PAR onchain price as voted in MIP-25

We have considered the osETH risk’s assessment to chose these parameters

(You can find out the risk assessment details of this asset in the previous MIR discussion)

These parameters aim to be balanced for the users and the protocol, but they were also chosen in a low-risk way to be able to run experiment parameters on the pool without possible issues for the users and the protocol given the potential smart contract risks that may exist.

Note that these parameters are likely to be changed in the future according to the first data that we will collect.

Means:

• Human resources: If the proposal is approved, multisig DAO signers will need to sign and execute transactions to add osETH as collateral on Parallel.
• Treasury resources: No treasury cost

Technical implementation:

Add osETH in the PAR ConfigProvider contract by calling the 'SetCollateralConfig' function with these parameters:

• '_collateralType' : 0xf1c9acdc66974dfb6decb12aa385b9cd01190e38 (osETH)
• ‘_debtLimit': 100000000000000000000000 // 100k debt limit
• ‘_liquidationRatio' : 1250000000000000000 // 1.25 liquidation ratio
• ‘_minCollateralRatio' : 1300000000000000000 // 1.30 minimum collateral ratio
• ‘_borrowRate' : decided by PAR onchain price as voted in MIP-25
• ‘_originationFee' : 2000000000000000 // 0.2% origination fee
• ‘_liquidationBonus' : 75000000000000000 // 7,5% liquidation bonus
• ‘_liquidationFee' : 0 // 0% liquidation fee

Voting options:

• Accept these new parameters
• Against / Rework the Proposal
• Abstain

Authors: @starny & @JeanBrasse from Mimo Labs