[GIP-28] Update stETH oracle
AI summary
This proposal aims to update how the Gearbox protocol calculates the price of stETH (staked Ethereum) to prevent unnecessary liquidations. Currently, Gearbox uses Chainlink USD price feeds for both ETH and stETH, which can lead to calculation errors during volatile market conditions, even if the stETH to ETH price ratio remains stable. This has caused users to be liquidated three times despite no actual depeg of stETH from ETH.
If approved, the protocol will implement a more accurate stETH price oracle, reducing the risk of unexpected liquidations for users holding stETH. This benefits users by providing more stability and predictability, while the protocol avoids 'churning users in liquidations'. No specific group loses from this change.
Voting results
🐳 Whale votes
0 votes > 5% VPFull proposal
Summary
Gearbox v2 uses Chainlink USD oracles. So when you are dealing with ETH debt <> stETH position, the Chainlink price tick is different for both and might cause liquidation even if stETH does not actually depeg relative to ETH. So stETH/ETH can be at 1:1 yet the oracle deviations can lead to HF dropping <1.
That has happened 3 times so far, and while this behavior & risk were communicated and elaborated on - such behavior is still unsatisfying from the user perspective. The goal is to fix that.
This is not an exploit in any way. This does not lead to bad debt. The protocol work…