Wind down the Borrowing Pool?
AI summary
This proposal suggests shutting down the dYdX borrowing pool. This involves stopping the rewards paid to users who stake USDC (a stablecoin pegged to the US dollar) in the Liquidity Staking Pool, removing the option for new deposits into this pool, and redirecting the remaining rewards, which amount to 383,562 DYDX tokens per epoch, to the Community Treasury. The reasons cited are that the current system pays rewards for underused capital, lacks transparency from borrowers, and negatively affects competition among liquidity providers.
If passed, users currently staking USDC will no longer receive DYDX rewards, and new deposits into the borrowing pool will be halted. The dYdX Community Treasury will gain an additional 383,562 DYDX tokens per epoch, increasing its resources. This change aims to improve capital efficiency and fairness within the dYdX ecosystem.
Voting results
🐳 Whale votes
0 votes > 5% VPFull proposal
Summary
We propose winding down the borrowing pool by – (1) turning off rewards rewards generated by staking USDC to the Liquidity Staking Pool, (2) removing the deposit functionality for the Liquidity Staking Pool from https://dydx.community/dashboard, and (3) sending the remaining rewards (383, 562 DYDX per epoch) allocated to users who stake USDC to the Community Treasury.
The reasons for proposing to wind down the borrowing pool are - (a) the dYdX community is paying DYDX rewards for underutilized USDC capital, (b) prospective borrowers provided inadequate disclosure, and (c) the st…