[VIP] Changing the interest rate parameters for VAI


This VIP proposes a new set of parameters for VAI based on this discussion.



Increase the steepness of the interest rate curve of VAI to incentivize VAI close to $1.


  • Harden the peg by making it expensive to borrow VAI when the VAI price is low.
  • Provide a better rate for borrowers when VAI is at $1.


Modification of this VIP:

  • baseRate: 3% (from 4%)
  • floatRate: 4000% (from 225%)

We provide below an exemple of the implication of the changes:

This VIP doesn’t enable VAI borrowings, this will be enabled in a following VIP contingent to having a significant healthy buffer in the VAI USDT PSM.

Risk Analysis

  • Reduction of earnings if VAI stays at $1
  • Increasing the VAI borrow rate might reduce VAI borrowings and TVL

Read the Steakhouse disclaimers

Nice, this is is a good way to go

1 Like

Proposal on vote tomorrow here.

Please make your voice heard.