The Governance Facilitators, Dewiz, and Sidestream have placed an executive proposal into the voting system. MKR/SKY Holders should vote for this proposal if they support the following alterations to the Sky Protocol.

If you are new to voting in the Sky Protocol, please see the voting guide to learn how voting works.

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Executive Summary

If this executive proposal passes, the following actions will occur within the Sky Protocol:

• Stability Scope Parameter Changes:
  • WBTC Vault Stability Fees will be increased.
  • DAI Savings Rate and SKY Savings Rate will be changed.
• The final LITE-PSM-USDC-A migration actions (Phase 3) will be executed.
• The Aave Lido Market Spark USDS Direct Deposit Module (DDM) will be activated.
• WBTC-A, WBTC-B, and WBTC-C liquidation parameters will be updated.

Voting for this executive proposal will place your MKR/SKY in support of the actions outlined above.

Unless otherwise noted, the actions 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 Sky Protocol after the GSM Pause Delay has expired. The GSM Pause Delay is currently set to 16 hours.

This executive proposal includes an office-hours modifier that means that it can only be executed between 14:00 and 21:00 UTC, Monday - Friday.

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

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Proposal Details

Stability Scope Parameter Changes

• Authorization: Ecosystem Approval
• Proposal: Forum Post

If this executive proposal passes, then the following Stability Fee (SF), Dai Savings Rate (DSR), and Sky Savings Rate (SSR) changes will take place as described below.

Stability Fee Increases

• Increase WBTC-A SF by 1.5 percentage points from 7.75% to 9.25%.
• Increase WBTC-B SF by 1.5 percentage points from 8.25% to 9.75%.
• Increase WBTC-C SF by 1.5 percentage points from 7.5% to 9%.

DSR and SSR Changes

• Decrease DSR by 0.5 percentage points from 6% to 5.5%.
• Increase SSR by 0.25 percentage points from 6.25% to 6.5%.

The current Spark DAI market Interest Rate Model (IRM) is tied to the DSR. Consequently, the 50 basis point reduction in DSR will result in an approximate, but not exact, 50 basis point decrease in the Effective DAI Borrow Rate on SparkLend.

LITE-PSM-USDC-A Migration Phase 3

• Authorization: Ecosystem Approval, Poll 1143
• Proposal: Forum Post

If this executive proposal passes, then the third and final set of actions in the migration process from USDC-PSM-A to LITE-PSM-USDC-A will be executed. This set of actions comprises the following:

• Update PSM-USDC-A fees.
• Migrate all remaining USDC reserves from PSM-USDC-A to LITE-PSM-USDC-A.
• Remove PSM-USDC-A from the Debt Ceiling Instant Access Module (DC-IAM).
• Increase the LITE-PSM-USDC-A Buffer (buf).
• Update the LITE-PSM-USDC-A DC-IAM parameters.

These actions are described below.

PSM-USDC-A Fee Update

• Decrease Fee In (tin) by 0.01 percentage points from 0.01% to 0%.
• Decrease Fee Out (tout) by 0.01 percentage points from 0.01% to 0%.

Remaining USDC Migration

The remaining USDC in PSM-USDC-A will be migrated to LITE-PSM-USDC-A through a script executed in the spell.

PSM-USDC-A DC-IAM Update

• Remove PSM-USDC-A from the Debt Ceiling Instant Access Module (DC-IAM).
• Set PSM-USDC-A Maximum Debt Ceiling (line) to 0 DAI.

LITE-PSM-USDC-A Buffer Increase

• Increase the LITE-PSM-USDC-A Buffer (buf) by 200 million DAI from 200 million DAI to 400 million DAI.

LITE-PSM-USDC-A DC-IAM Update

• Increase the Maximum Debt Ceiling (line) by 2.5 billion DAI from 7.5 billion DAI to 10 billion DAI.
• Increase the Target Available Debt (gap) by 200 million DAI from 200 million DAI to 400 million DAI.
• Keep the Ceiling Increase Cooldown (ttl) unchanged at 12 hours.

Aave Lido Market Spark USDS Direct Deposit Module (DDM) Activation

• Authorization: Ecosystem Approval
• Proposal: Forum Post

If this executive proposal passes, then the Aave Lido Market Spark USDS DDM will be activated by executing the following actions:

• Add new ilk as DIRECT-SPK-AAVE-LIDO-USDS.
• Set up the DDM DC-IAM.
• Set up the DDM addresses.
• Extend the DIRECT_MOM Breaker to include the new DDM.

These actions are further described below.

New ilk Addition

A new ilk will be added as DIRECT-SPK-AAVE-LIDO-USDS.

Aave Lido Market Spark USDS DDM Setup

• Maximum Debt Ceiling (line): 100 million USDS.
• Target Available Debt (gap): 50 million USDS.
• Ceiling Increase Cooldown (ttl): 24 hours.
• Debt Write-off Timelock (tau) (Defines the time to elapse before debt can be written off after a DDM has been caged): 7 days.

DDM Addresses Setup

• oracle: D3MOracle at 0x9dB0EB29c2819f9AE0A91A6E6f644C35a7493E9b
• plan: D3MOperatorPlan at 0xea2abB24bF40ac97746AFf6daCA0BBF885014b31
• pool: D3MAaveV3USDSNoSupplyCapTypePool at 0xbf674d0cD6841C1d7f9b8E809B967B3C5E867653
• aToken: 0x09AA30b182488f769a9824F15E6Ce58591Da4781
• operator: 0x298b375f24CeDb45e936D7e21d6Eb05e344adFb5
• stabledebt address: 0x779dB175167C60c2B2193Be6B8d8B3602435e89E
• variabledebt address: 0x2D9fe18b6c35FE439cC15D932cc5C943bf2d901E

DIRECT_MOM Breaker Extension

If this executive proposal passes, then the DIRECT_MOM Breaker will be extended to include the Aave Lido Market Spark USDS DDM, enabling governance to deactivate vault functionality through an executive spell without waiting for the GSM Pause Delay.

WBTC Legacy Vault Parameter Changes

• Authorization: Ecosystem Approval
• Proposal: Forum Post

If this executive proposal passes, then the following WBTC risk mitigation actions will be executed on WBTC Legacy Vaults:

• Decrease Liquidation Penalty (chop) for WBTC-A, WBTC-B, and WBTC-C from 13% to 0%.
• Increase WBTC-A Liquidation Ratio using the Linear Interpolation (LERP) module by 5 percentage points from 145% to 150% over 6 days.
• Increase WBTC-B Liquidation Ratio using the Linear Interpolation (LERP) module by 20 percentage points from 130% to 150% over 6 days.

Review

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

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Resources

Additional information about the Governance process can be found in the Operational Manual.

To add current and upcoming votes to your calendar, please see the Sky Governance Calendar.