Maker Governance - Proposal Collateral Auction Parameter Changes, MOMC Parameter Adjustments, Recognized Delegate Compensation for September

Collateral Auction Parameter Changes, MOMC Parameter Adjustments, Recognized Delegate Compensation for September - October 14, 2022

Spell Address

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MKR Support

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Supporters

The Governance Facilitator(s) and the Protocol Engineering Core Unit have placed an executive proposal into the voting system. MKR Holders should vote for this proposal if they support the following alterations to the Maker Protocol.

If you are new to voting in the Maker Protocol, please see the voting guide to learn how voting works, and this wallet setup guide to set up your wallet to vote.

Executive Summary

If this executive proposal passes, the following changes will occur within the Maker Protocol:

Multiple Collateral Auction Risk Parameters will be changed, as detailed below.
Parameter adjustments from the latest proposal from the MakerDAO Open Market Committee proposal, as detailed below.
A total of 120,490 DAI will be paid to eighteen Recognized Delegates, itemized below.

Voting for this executive proposal will place your MKR in support of the changes and additions outlined above.

Unless otherwise noted, the changes and additions listed above are subject to the GSM Pause Delay. This means that if this executive proposal passes, the changes and additions listed above will only become active in the Maker Protocol after the GSM Pause Delay has expired. The GSM Pause Delay is currently set to 48 hours.

If this executive proposal does not pass within 30 days, then it will expire and can no longer have any effect on the Maker Protocol.

Proposal Details

Collateral Auction Risk Parameter Changes

As per this successful governance poll, the following parameter changes will be made, if this executive proposal passes. Please review the proposal thread from the Risk Core Unit to inform your position.

Auction Price Multiplier (`buf`) Changes

The following collateral types will have their buf reduced by 0.1 from 1.2 to 1.1:

ETH-A
ETH-B
ETH-C
WBTC-A
WBTC-B
WBTC-C
WSTETH-A
WSTETH-B

The following collateral types will have their buf decreased by 0.1, from 1.3 to 1.2:

CRVV1ETHSTETH-A
LINK-A
MANA-A
MATIC-A
RENBTC-A

Note: The Risk Core Unit summarizes these changes as follows:

The effect of these changes is a shorter average settlement duration:

From about 28 minutes to 15 minutes for (st)ETH and WBTC high-to-mid liquidation ratio vault types.
From about 19 minutes to 10 minutes for ETH and WBTC low liquidation ratio vault types.
From about 40 minutes to 27 minutes for "tier two" vaults (higher volatility and lower liquidity collateral).

Max Auction Drawdown (`cusp`) Changes

The following collateral types will have their cusp increased by 0.05, from 0.4 to 0.45:

ETH-A
ETH-B
ETH-C
WBTC-A
WBTC-B
WBTC-C
WSTETH-A
WSTETH-B

Note: The Risk Core Unit summarizes these changes as follows:

The intention of these changes is to keep a similar price drawdown reset threshold as it is now: at about 0.5 of OSM price.

Max Auction Duration (`tail`) Changes

The following collateral types will have their tail decreased by 1,200 seconds, from 8,400 seconds to 7,200 seconds:

ETH-A
ETH-C
WBTC-A
WSTETH-A
WSTETH-B

The following collateral type will have its tail decreased by 600 seconds, from 5,400 seconds to 4,800 seconds:

WBTC-B

The following collateral type will have its tail increased by 1,800 seconds, from 5,400 seconds to 7,200 seconds:

WBTC-C

The following collateral type will have its tail decreased by 3,600 seconds, from 8,400 seconds to 4,800 seconds:

ETH-B

Note: there is a discrepancy between the current value in the poll and the current value listed here for ETH-B. Please see this forum post.

Note: The Risk Core Unit summarizes these changes as follows:

The intention of these changes is to satisfy the condition of keeping maximum duration until the auction price reaches about 50% of OSM.

Local Liquidation Limit (`ilk.hole`) Changes

The following ilk.hole changes will be made:

Decrease the ETH-A ilk.hole from 65,000,000 DAI to 40,000,000 DAI.
Decrease the ETH-B ilk.hole from 30,000,000 DAI to 15,000,000 DAI.
Decrease the WBTC-A ilk.hole from 40,000,000 DAI to 30,000,000 DAI.
Decrease the WBTC-B ilk.hole from 25,000,000 DAI to 10,000,000 DAI.
Decrease the WBTC-C ilk.hole from 25,000,000 DAI to 20,000,000 DAI.
Decrease the LINK-A ilk.hole from 6,000,000 DAI to 3,000,000 DAI.
Decrease the YFI-A ilk.hole from 5,000,000 DAI to 1,000,000 DAI.
Decrease the RENBTC-A ilk.hole from 3,000,000 DAI to 2,000,000 DAI.

Note: The Risk Core Unit summarizes these changes as follows:

Because faster auction cycles are being proposed, about 50% more collateral should get settled per unit of time.

Global Liquidation Limit (`Hole`) Change

The Hole will be reduced by 30,000,000 DAI from 100,000,000 DAI to 70,000,000 DAI.

Note: The Risk Core Unit summarizes this change as follows:

This corresponds to a general increase in auction throughput due to shorter auction cycles.

Flat Kick Incentive (`tip`) Changes

The following collateral types will have their tip decreased by 50 DAI from 300 DAI to 250 DAI:

ETH-A
ETH-B
ETH-C
WBTC-A
WBTC-B
WBTC-C
WSTETH-A
WSTETH-B
CRVV1ETHSTETH-A
LINK-A
MANA-A
MATIC-A
RENBTC-A
YFI-A

MOMC Parameter Adjustments

As per this poll, the following changes recommended by the Maker Open Market Committee - Parameter Proposal Group will be made, if this executive proposal passes:

Decrease the CRVV1ETHSTETH-A Stability Fee by 0.5% from 2% to 1.5%.
Decrease the YFI-A Maximum Debt Ceiling (line) by 15 million DAI from 25 million DAI to 10 million DAI.

Recognized Delegate Compensation for September 2022

As per MIP61: Recognized Delegate Compensation, a total of 120,490 DAI will be distributed to eighteen Recognized Delegates as itemized below if this executive proposal passes:

12,000 DAI will be transferred to JustinCase at 0xE070c2dCfcf6C6409202A8a210f71D51dbAe9473.
12,000 DAI will be transferred to Doo at 0x3B91eBDfBC4B78d778f62632a4004804AC5d2DB0.
12,000 DAI will be transferred to schuppi at 0xCCffDBc38B1463847509dCD95e0D9AAf54D1c167.
11,633 DAI will be transferred to Flip Flop Flap Delegate LLC at 0x688d508f3a6B0a377e266405A1583B3316f9A2B3.
11,396 DAI will be transferred to Flipside Crypto at 0x62a43123FE71f9764f26554b3F5017627996816a.
10,696 DAI will be transferred to Feedblack Loops LLC at 0x80882f2A36d49fC46C3c654F7f9cB9a2Bf0423e1.
10,322 DAI will be transferred to Penn Blockchain at 0x2165d41af0d8d5034b9c266597c1a415fa0253bd.
8,509 DAI will be transferred to GFX Labs at 0xa6e8772af29b29B9202a073f8E36f447689BEef6.
7,996 DAI will be transferred to mhonkasalo & teemulau at 0x97Fb39171ACd7C82c439b6158EA2F71D26ba383d.
7,372 DAI will be transferred to Chris Blec at 0xa3f0AbB4Ba74512b5a736C5759446e9B50FDA170.
6,681 DAI will be transferred to ACREInvest at 0x5b9C98e8A3D9Db6cd4B4B4C1F92D0A551D06F00D.
3,506 DAI will be transferred to Blockchain@Columbia at 0xdC1F98682F4F8a5c6d54F345F448437b83f5E432.
2,136 DAI will be transferred to Frontier Research LLC at 0xA2d55b89654079987CF3985aEff5A7Bd44DA15A8.
1,974 DAI will be transferred to London Business School Blockchain at 0xB83b3e9C8E3393889Afb272D354A7a3Bd1Fbcf5C.
1,839 DAI will be transferred to Llama at 0xA519a7cE7B24333055781133B13532AEabfAC81b.
269 DAI will be transferred to CodeKnight at 0x46dFcBc2aFD5DD8789Ef0737fEdb03489D33c428.
108 DAI will be transferred to ONESTONE at 0x4eFb12d515801eCfa3Be456B5F348D3CD68f9E8a.
53 DAI will be transferred to pvl at 0x6ebB1A9031177208A4CA50164206BF2Fa5ff7416.

Review

Community debate on these topics can be found on the MakerDAO Governance forum. Please review any linked threads to inform your position before voting.

Additionally, these changes may have been discussed further in recent Governance calls. Video for these calls is available to review.