What you are voting for?

• Extending 400,000 XAI of Credit to the gOHM silo

gOHM Credit Line

Basics

Name: Governance OHM

Ticker: $gOHM

Contract Address: 0x0ab87046fbb341d058f17cbc4c1133f25a20a52f

Description: $gOHM is a wrapped staked version of $OHM, a reserve currency that is backed by PoL in the form of bonded assets

Liquidation Threshold: 85%

Max Liquidation Fee: 15%

Absolute Parameters

Oracle: Chainlink OHMv2/ETH price feed in combination with Silo’s custom gOHM<>OHM oracle

Liquidation: Silo’s liquidation engine can liquidate $gOHM collateral efficiently.

Protocol-Wide Parameters

As discussed in the original Risk Framework, no individual silo will receive a credit line extension exceeding 2,348,150 $XAI (1,643,705 $XAI after application of liquidity buffer).

Silo-Specific Parameters

$OHM (the proxy for $gOHM) has relatively shallow on-chain liquidity across Uniswap v3 and Balancer v2. Currently, liquidators are hard-coded to route through the OHM/ETH Balancer v2 only which has ~35m liquidity.

Simulating sales of our max credit line extension value implies a slippage of 11.4% which is within acceptable ranges given our max liquidation fee of 15% for $gOHM.

As such, the binding constraint for a credit line to $gOHM is our Protocol-wide Parameters (i.e. $XAI on-chain liquidity) rather than $gOHM itself.

Recommendation

$gOHM is a widely circulated reserve currency token with significant integrations across the DeFi landscape.

It should be noted that our liquidator is hard-coded to route via the Balancer v2 OHM/ETH pool only. As such, we recommend a credit line only to the amount of 400k $XAI, which will incur slippage of 1.7% which is within reasonable bounds for liquidator profitability.

We recommend continued assessment of on-chain liquidity of both $gOHM (proxied by OHM/ETH liquidity) and $XAI to ensure that it remains within a safe range that will allow liquidations to occur as normal.