[IP] Collateral Basket Change Proposal #2 Base

High Yield USD (hyUSD) hyUSD RFC
1

Summary

This proposal suggests continuing to remove bridged USDC(USDbC) from the collateral basket by swapping Compound USDbC for Compound USDC, due to USDbC eventually becoming a deprecated asset across base. This proposal would require the registering of USDC as well as setting it as backup collateral.

Current Compound Asset Basket Weight:

50% Compound USDbC

Proposed Compound Asset Basket Weight:

50% Compound USDC

Abstract

Compound:
The concerns of USDbC becoming a deprecated asset on Base are approaching. The proposed proposal, if enacted, would swap the Compound Market of USDbC with the Compound Market of USDC in the collateral basket. The proposed proposal would also register USDC and set it as backup collateral.

Problem Statement:

The current basket for hyUSD on Base contains 50% of the Compound USDbC pool. USDbC or the USDC that is bridged from ETH to Base will become deprecated across base, and eventually replaced with native USDC.

Rationale

Compound:
Compound is a decentralized lending protocol and is being used in the hyUSD basket but with USDbC being the underlying asset. We are striving to increase the long term scalability of High Yield USD on Base, and thus we believe that swapping Compounds underlying asset USDbC for USDC would be a wise decision. We also believe that registering and setting USDC as backup collateral would be a wise decision as well.

Risks

By removing a soon to be deprecated asset we believe that we are increasing the scalability for a longer term outlook. We believe we are doing so in a way that doesn’t increase the risk profile of High Yield USD on Base by simply swapping an underlying asset of a protocol that is already being used in the collateral basket.

  • Yes, I am for this proposal
  • No, I am against this proposal
0 voters
4 Likes
2

makes sense to me. USDC market is strictly better at this point.

1 Like
3

Yes. We should lead the charge of deprecating USDbC in favor of native USDC. There is no downside here plus we’re doing the Base community at large a favor. Win-win.

2 Likes
4

+1

Reduce the risk, and update the basket of assets.

5

Hi! Firstly, I wanted to congratulate the High Yield USD team for the high quality of their written communications. In an effort to help governance proposal clarity and following the reccommended naming conventions published in the forum by StableLab, we modified the title of the proposal to clearly display [RFC] (between square brackets) at the beginning of the title. We encourage the hyUSD team to adopt this convention to keep a good [RFC] and [IP] record track.

Reccommended proposal guidelines: Naming convention for RFCs and IPs

In addition, this proposal has been published for onchain voting and approved by majority here: