Summary
This is a proposal for creating a new liquidity market to support Circle’s USDCx stablecoin token for lending, borrowing and collateral use on the Liqwid protocol.
https://defillama.com/stablecoin/usd-coin
https://www.usdc.com/
Project & Token Overview
USDC is the world’s largest regulated digital dollar issued by Circle with USDCx being the standard USDC version issued for use on non-EVM chains. USDC is a fully regulated dollar digital stablecoin launched by Circle. USDC is fully backed by cash and short-dated U.S. government obligations, so that it is always redeemable 1:1 for U.S. dollars.
Market Reasoning
This launch represents the first deployment of a tier 1 stablecoin issued natively on Cardano mainnet. With launch planned imminently this represents a strong opportunity for Liqwid to offer additional solid stablecoin options to users seeking yield and liquidity.
Technical Considerations
USDCx is issued natively as a Cardano Native Token and Cardano developers have completed extensive testing and formal verification ahead of mainnet launch. As a result the risks are low and the ease for Liqwid developers to support new USDCx markets significantly increased.
Market Parameters
Following feedback from Liqwid community members and core developers there will be 1 USDCx market deployed with the following parameters:
USDCx market will be launched with the same 5% base rate at 0 utilization as current stablecoin markets with a borrow rate of 25% at 90% optimal utilization (kinkRate). Supported collateral types in this market will be ADA, NIGHT, USDA, USDM and DJED. These collaterals will have equal borrowing power as they do in existing stablecoin markets.
Interest rate market parameters for the USDCx market
| BaseRate | 5% |
|---|---|
| utilMultiplier | 22.2% |
| utilmultiplierjump | 300.0% |
| kinkRate | 90% |
Risk Parameters
LiquidationLTV Threshold: 80.00%
MaxLTV: 69.56%
Liquidation Penalty: 10.00%
Liquidation Profitability:11.11%
Specifications
Liqwid Labs developers are supporting Cardano developers delivering the USDCx solution to mainnet during the final testing and integration phase before launch.
Conclusion
The Liqwid core team strongly recommends the adoption of this proposal to add support for USDCx markets for lending, borrowing and collateral use on Liqwid.
Do you support this proposal?
- Yes
- No