Aave

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title: [TEMP CHECK] stEUR Onboarding on Aave V3 Ethereum Pool author: @marczeller - Aave-chan Initiative date: 09-10-2023

Summary

This TEMP CHECK proposes the onboarding of stEUR as a collateral-only asset on the Aave V3 Ethereum Pool. stEUR represents staked agEUR, a decentralized EUR-peg stablecoin minted by the Angle Protocol.

Motivation

• Decentralized Stablecoin Diversity: At the ACI, we support the diversity of decentralized stablecoins. EUR stablecoins, in particular, are underrepresented in the ecosystem, and onboarding stEUR can help bridge this gap.

• Growth in a Controlled Environment: While stEUR and agEUR have relatively small market caps (5M$ and 20M$ respectively), onboarding stEUR as a collateral-only asset with limited caps will allow it to grow in a controlled environment, minimizing risks for the Aave protocol.

• Collateral Potential: stEUR, being a staked version of a decentralized EUR-peg stablecoin, presents a promising collateral candidate for Aave.

Specification

• Asset: stEUR
• Contract Address: 0x004626A008B1aCdC4c74ab51644093b155e59A23

Price Feed

For the price feed, we propose implementing a price adapter that calculates the value of stEUR based on the value of agEUR/USD and the exchange rate of agEUR/stEUR.

This replicates precedents such as with sDAI.

Risk Parameters

We propose the following parameters for stEUR onboarding:

Parameter	Value
Isolation Mode	No
Borrowable	No
Borrowable in Iso	No
Stable Borrowing	No
Collateral Enabled	Yes
Supply Cap (stEUR)	3,000,000
Borrow Cap (stEUR)	0
Debt Ceiling	N/A
LTV	70%
LT	75%
LB	8%
LPF	10%
Reserve Factor	20%
Base Rate	0%
Slope 1	8%
Slope 2	80%
Optimal Ratio	80%

Next Steps

1. If TEMP CHECK snapshot outcome is YAE, escalate to ARFC stage.
2. If consensus on ARFC stage is reached and risk service providers provided feedback on risk parameters, escalate to ARFC snapshot stage.
3. If ARFC snapshot stage outcome is YAE, escalate to AIP stage.

Disclaimer

The Aave-chan Initiative is not presenting this TEMP CHECK on behalf of any third party and is not compensated by Angle for creating this TEMP CHECK.

Copyright

Copyright and related rights waived via CC0.