Launch GHO Market on Ethereum


title: Launch GHO Market on Ethereum
author: @TokenLogic and karpatkey
created: 2024-10-17


Summary

This proposal seeks community support to deploy GHO on Fluid.

Motivation

GHO is a decentralized multi-collateral stablecoin that is fully backed, transparent and native to the Aave Protocol with approximately 150M of circulating supply.

GHO’s collateral ratio exceeds 2.35 and is backed by high-quality assets such as wstETH which makes up 23.76% of the collateral backing GHO. There is also 8M in both the USDC and USDT GHO Stability Modules.

The Aave Liquidity Committee (ALC) is wanting to explore integrations that are expected to support GHO’s growth and broader adoption across various lending protocols.

InstaDapp’s Fluid platform presents a promising opportunity to onboard GHO on the Fluid DEX and lending market. Integrating a growing stablecoin like GHO has consistently proven to be mutually beneficial for the stablecoin issuer and the broader lending market.

Specification

Boost Stablecoin Rewards

To enhance both GHO-USDC deep liquidity and lending/borrowing demand, we propose boosting rewards for the relevant vaults through targeted liquidity mining incentives.

The ALC plans to match this initiative with a dedicated GHO budget, for an initial 3 month period and is in touch with prospective depositors.

Vaults specifications

GHO<>USDC/GHO-USDC Smart Collateral/Smart Debt Vault

  • Collateral Factor (C.F.): 80%
  • Liquidation Threshold (L.T.): 85%
  • Max Liquidation Limit (L.M.L.): 90%
  • Liquidation Penalty (L.P.): 2%

ETH/GHO Vault:

  • Collateral Factor (C.F.): 85%
  • Liquidation Threshold (L.T.): 90%
  • Max Liquidation Limit (L.M.L.): 93%
  • Liquidation Penalty (L.P.): 2.5%

wstETH/GHO Vault:

  • Collateral Factor (C.F.): 82%
  • Liquidation Threshold (L.T.): 88%
  • Max Liquidation Limit (L.M.L.): 92.5%
  • Liquidation Penalty (L.P.): 3%

sUSDe/GHO Vault:

  • Collateral Factor (C.F.): 88%
  • Liquidation Threshold (L.T.): 90%
  • Max Liquidation Limit (L.M.L.): 95%
  • Liquidation Penalty (L.P.): 2%

weETH/GHO Vault:

  • Collateral Factor (C.F.): 77%
  • Liquidation Threshold (L.T.): 82%
  • Max Liquidation Limit (L.M.L.): 90%
  • Liquidation Penalty (L.P.): 3%

sUSDS/GHO Vault:

  • Collateral Factor (C.F.): 90%
  • Liquidation Threshold (L.T.): 92%
  • Max Liquidation Limit (L.M.L.): 95%
  • Liquidation Penalty (L.P.): 2%

Vault Rate Margin

The sUSDe/GHO and sUSDS/GHO vault is to use the same 10% rate margin as the sUSDe/USDC and sUSDe/USDT vaults.

The borrow rate for these vaults will always be the higher of either the Margin Rate or the underlying liquidity layer rate.

Disclosure

TokenLogic and karpatkey are both Service Providers and Delegates within the Aave community.

Copyright

Copyright and related rights waived via CC0.

5 Likes

I am clearly in favor of this idea.

Good thing to propose new stable borrowing alternative to Fluid + the SC/SD vault will be one of the pioneer of stablecoin LPing that could be leveraged on Fluid.

Instadapp is very supportive of this proposal and welcomes Aave on Fluid. We will prepare an onchain proposal for GHO vaults and GHO DEX listings to have it immediately after the DEX launch which is scheduled on 29th October

1 Like