Overview

Current utilization of the USDC pool is ~50%, which is good, but still lower than our target of 80-90%. To increase utilization, it is proposed to add USDe and sUSDe tokens, as well as ezETH to enable boosting WETH leverage trades with points.

It is also proposed to add ezETH to the WETH arbitrum pool with a 0 quota limit, in order to be able to quickly enable the token once ezETH liquidity arrives.

Onboarding Ethena for Trade USDC pool and increasing quota limits for weETH

Ethena quickly burst into the stablecoin market: despite its launch less than a month ago, it is already in the Top 6. This rapid growth is supported by the shards distribution program. Therefore it is proposed to add USDe and sUSDe.

Asset	Quota increase fee	Min quota rate	Max quota rate	Limit
USDe	0%	0.05%	30%	3M USDC*
sUSDe	0%	0.05%	30%	3M USDC*

Enabling ezETH as boosted trade option

We saw huge interest in the leveraging Eigenlayer points on WETH Credit Accounts. And it seems in a bull market it’s good to have an option for users to Long ETH and farm points at the same time. This is a unique feature of Composable Leverage!

Asset	Quota increase fee	Min quota rate	Max quota rate	Limit
ezETH	0%	0.05%	30%	3M USDC*

Credit Manager specification

Below are specification and changes that should be made to USDC Tier 1 Credit Manager:

Collateral tokens & LTVs

Token	LTV	Comment
ezETH	90%
USDe	90%
sUSDe	90%

Adapters

The following is the list of new adapters and pools to be connected to USDC Tier 1 CM:

• UNISWAP_V3_ROUTER
  • USD_e/USDT 0.01% pool
• BALANCER_VAULT
  • Balancer ezETH/WETH pool
• CURVE USDe_USDC_POOL
• CURVE USDe_DAI_POOL
• CURVE sUSDe_sDAI_POOL

Enabling ezETH on Arbitrum

In response to popular demand, we also want to allow leveraged restaking with Renzo’s ezETH on Arbitrum.

However, currently ezETH/WETH liquidity on Arbitrum is very shallow. We expect Renzo to increase liquidity soon, and in order to enable ezETH leveraging as quickly as possible once that happens, it is proposed to add ezETH to the WETH pool as a quoted token, while the limit is set to 0.

Asset	Quota increase fee	Min quota rate	Max quota rate	Limit
ezETH	0%	0.05%	30%	0

We also propose to allow the technical multisig on Arbitrum to conditionally enable ezETH leveraging when two things happen:

• There is significant liquidity for the ezETH / WETH pair on Uniswap V3 or Balancer (at least 500 WETH worth of liquidity);
• Connext enables quick withdrawals of ezETH from Arbitrum;

Once those things happen, the technical multisig would be able, without additional voting, to:

• Increase the ezETH quota limit to up to 1000 WETH (but can be less, depending on available liquidity);
• Allow the pool required for trading in the WETH Tier 1 Credit Manager (both Uniswap V3 and Balancer adapters are already connected, so only the required pool needs to be allowed);

With this scheme, we would be able to activate ezETH leveraging within 36 hours after liquidity goes live.

Notes

* If cap is full, limits per asset can be increased by Timelock Controller and Technical Multisig up to 15M USDC as well as overall debt limit of Credit Manager - up to 30M, without any further voting.

Voting

Simple Approve/Reject voting