# Optimism USDC and USDT IRM Updates\n## Summary\n\nGauntlet recommends an update to the interest rate model (IRM) on the Optimism **USDC** and **USDT** comets. The change raises the borrow rate base from 1.5% to 3.0% and flattens the borrow slope below kink, while leaving the supply curve, kink, and high-utilization slope unchanged. This is a deliberate realignment of the revenue mix: it shifts protocol earnings toward interest income and away from reliance on liquidation revenue, and it sharpl
AI summary
This proposal from Gauntlet suggests updating the interest rate model (IRM) for USDC and USDT on Compound's Optimism deployment. Specifically, it would increase the base borrow rate from 1.5% to 3.0% and flatten the borrow interest rate below a certain utilization point. The goal is to shift Compound's revenue generation more towards interest income from borrowers and less on liquidations, while also reducing how quickly reserves are used up when these markets are moderately utilized.
If passed, borrowers of USDC and USDT on Optimism will face higher base interest rates. This change aims to improve the protocol's financial stability by increasing its interest income, potentially benefiting Compound token holders through more robust reserves. There are no direct financial losses to any specific group, but borrowers will pay more.