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Fei-Rari Fuse Pool Charts

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Summary

This proposal would have FEI DAO alter the existing parameters of the FeiRari Fuse Pool. The goal is to tweak the parameters to attract borrowers.

Motivation

The FeiRari pool’s existing parameters are relatively conservative and not friendly enough to be competitive in terms of borrowing. We have analyzed the various parameters and come to the conclusion that to make the pool more efficient, we must propose some changes.

The plan is to make them more aggressive in order to attract borrowers, as the DAO can supply FEI to bootstrap the market. We will also take advantage of this opportunity to tune the parameters of the other three assets in the pool. We have seen the performance of the pool over two weeks and now we are ready to update the parameters to drive higher volume to it. The DAO has already supplied 10M FEI upon taking over the pool and it is possible it supplies even more FEI in the future. This makes this parameter tuning exercise more focused on attracting FEI borrowers.

Specification

Update existing FeiRari Fuse Pool Parameters:

1. Reduce Close Factor from 50% to 33%
2. Reduce Liquidation Incentives from 10% to 8%
3. Increase FEI, ETH and DAI collateral ratio from 75% to 80%
4. Update to FEI IRM
   1. Reduce FEI Base Rate from 2.73% to 0%
   2. Reduce FEI Initial Slope Multiplier from 36.40% to 7%
   3. Reduce FEI Second Slope Multiplier from 1650% to 400%
5. Update to TRIBE IRM
   1. Reduce TRIBE Base Rate from 2.73% to 0%
   2. Reduce TRIBE Initial Slope Multiplier from 53.75% to 20%
   3. Reduce TRIBE Second Slope Multiplier from 4000% to 400%
6. Update to DAI IRM
   1. Reduce DAI Base Rate from 2.73% to 0%
   2. Reduce DAI Initial Slope Multiplier from 53.75% to 10%
   3. Reduce DAI Second Slope Multiplier from 4000% to 400%
7. Update to ETH IRM
   1. Reduce ETH Base Rate from 2.73% to 0%
   2. Reduce ETH Initial Slope Multiplier from 53.75% to 8%
   3. Reduce ETH Second Slope Multiplier from 4000% to 400%

Voting Rules

Voting will last 2 days.

This is a non-binding signal vote. Please keep in mind that snapshot votes can be changed but not withdrawn until the end of the voting period.

The two options to vote on are:

1. Implement changes proposed to FeiRari Fuse Pool
2. Do not implement proposed changes and leave pool as is

This is a single choice vote, if option 1 wins the majority, we will submit a DAO proposal after the end of the snapshot vote.