Summary
Chaos Labs has completed a comprehensive analysis to provide informed recommendations for the launch parameters for the Venus deployment on zkSync. These initial recommendations aim to ensure a safe and efficient launch and are the basis for future optimization post-launch after observing usage on each pool.
Core Pool
Collateral Factor
- We used battle-tested parameters for native USDT.
- For USDC.e, we recommend slightly more conservative parameters than typical given the unique risks associated with bridged tokens. We advise migrating to native USDC once it approaches parity in supply and liquidity.
- At present, native USDC’s transaction count and on-chain supply ($6.69M) remains significantly smaller than USDC.e’s.
- For WBTC and WETH, we set this in the range of 75%-80%.
- For ZK we recommend starting with far more conservative parameters and increasing them as we monitor usage and risk with new positions.
Supply and Borrow Caps
- Derived from on-chain liquidity; specifically, 2x the current amount of liquidity available in a single swap on a DEX aggregator at the point where slippage equals liquidation incentive (10%).
- Borrow caps are derived from the supply cap, using the Kink as the optimal point for borrow amounts, and from that, calculating a borrow cap at slightly higher than the Kink.
IR Curves
- For analogous assets already listed on BNB Chain: parameters are aligned to Venus BNB Chain deployment.
- We recommend targeting a 7% borrow rate (at par with Maker’s latest DAI savings rate) for stables at the Kink.
Additional Parameters
- Close Factor: 50%
- Liquidation Incentive: 10%
- minLiquidatableCollateral: 100 USD
XVS Bridge Parameters:
ZKsync bridge to/from Ethereum, BNB, and opBNB
- Daily limit: 100,000 USD
- Single transaction: 20,000 USD
- mintable XVS on ZKsync: 500,000 XVS
Recommendations
| Asset | WETH | USDT | USDC.e | WBTC | ZK |
|---|---|---|---|---|---|
| Collateral Factor | 77% | 77% | 72% | 77% | 35% |
| Liquidation Threshold | 80% | 80% | 75% | 80% | 40% |
| Supply Cap | 2,000 | 4,000,000 | 5,000,000 | 40 | 25,000,000 |
| Borrow Cap | 1,700 | 3,300,000 | 4,200,000 | 20 | 12,500,000 |
| Kink | 80% | 80% | 80% | 45% | 45% |
| Base | 0% | 0% | 0% | 0% | 2% |
| Multiplier | 4.25% | 8.75% | 8.75% | 9% | 20% |
| Jump Multiplier | 80% | 80% | 80% | 200% | 300% |
| Reserve Factor | 20% | 10% | 10% | 20% | 25% |