Summary
A proposal to:
- Increase THE’s supply and borrow caps on Venus’s BNB Core deployment.
THE (BNB Core)
THE has reached 100% supply cap utilization and 82% borrow cap utilization following recent cap increases.
Supply Distribution
THE’s supply is not highly concentrated and, as was the case ahead of the last cap increase, all of the top suppliers maintain relatively strong health scores, loop, or do not borrow against their position.
USDT continues to be the most popular asset borrowed against THE, followed by THE itself.
Borrow Distribution
As described above and in the previous recommendation, there is some looping in the market; most of the largest THE borrow positions are against THE collateral combined with other collateral assets, reducing the risk of liquidation. There is a user borrowing 250K THE against USDC and USDT, though they maintain an extremely high health score.
Recommendation
Given user behavior and on-chain liquidity, we recommend increasing the asset’s supply and borrow caps.
This increase is backed by Chaos Labs’ risk simulations, which consider user behavior, on-chain liquidity, and price impact, ensuring that the higher cap does not introduce additional risk to the platform.
Specification
| Market | Asset | Current Supply Cap | Recommended Supply Cap | Current Borrow Cap | Recommended Borrow Cap |
|---|---|---|---|---|---|
| BNB Core Pool | THE | 4,800,000 | 12,000,000 | 2,400,000 | 6,000,000 |
Disclaimer
Chaos Labs has not been compensated by any third party for publishing this recommendation.