[Ethereum] Spark Savings - Increase Deposit Caps for spUSDC, spUSDT, and spETH - November 3, 2025

Spark's Operational Facilitator has placed a proposal into the voting system on behalf of nested contributor Phoenix Labs.

Review

The Spark community can hereby express support or opposition to the following changes, as described by the author of the proposal:

Spark Savings v2 vaults have seen strong growth, hitting their initial deposit caps soon after launch. While there is already a pending update to supply caps expected to be executed next week, we propose to further increase the caps in the following spell to avoid unnecessarily constraining growth of the vaults in case demand continues apace.

The key risk factor for higher deposit caps in the current configuration remains the possibility of the setter role setting an excessively high rate. This is limited by the maximum rate implemented onchain, which is 10% for stablecoin vaults and 5% for the ETH vault. If the setter implements a rate above Spark’s capacity for revenue generation for the deposits, this will result in net losses until the setter role can be deauthorized by governance. Using a conservative 4.5% rate of return for USD and 1.5% return for ETH, we estimate the maximum potential daily losses as 1.46 bps for stablecoin vaults and 0.94 bps per day for the ETH vault. This results in a total daily maximum loss of roughly 250,000 to 260,000 USDS per day across all Ethereum and Avalanche vaults. Considering the very low likelihood of compromise of the setter and fast speed of recovery, we conclude that this potential risk is outweighed by the benefit of ensuring sufficient capacity for Spark Savings deposit growth.

Parameter summary:

• spUSDC
  • Deposit cap: 500 million
• spUSDT
  • Deposit cap: 500 million
• spETH
  • Deposit cap: 100,000

The pull request (PR) for the proposed Artifact changes will be created at a later time. If concurrently polled SAEP-03 is approved, the PR will be created based on the structure it introduces; otherwise, a PR incorporating these changes into the current structure will be created.

Outcomes

• If "For" receives the most votes, the proposal will be approved. A PR will be created and merged, as described above. When required, the listed changes will proceed to implementation by the relevant actors.
• If "Against" receives the most votes, the proposal will be rejected. No changes will be implemented.