Increase iUSD MCR to 120%

[defiroose]

Because of Indigo’s and Cardano’s efficiency, iUSD was able to launch with a MCR of 110%. This helped bootstrap liquidity by minimizing the borrowing cost. Now that iUSD liquidity has been bootstrapped and the Stability Pool saturation is roughly 96%, we should increase the iUSD MCR to 120%. This in effect increases the borrowing cost which will help reduce the price spread of iUSD in the DEXs.

[zygomeb]

Cross-Linking

Increase iUSD MCR to ensure protocol solvency

The choice to launch iUSD with 110% MCR was in my opinion highly controversial. In this moment of no competition for Indigo it is paramount that the solvency of the protocol and proving in volatile environment the efficiency of liquidations during large downturns (and congested network). With this in mind, and knowing that the CDP creation demand balances out upside depeg I don’t believe that 1.10 usd (reasonable upwards bound for 110% MCR) is any cope – and already leaves a mark on the system. …

[Kobov9000]

yes, sounds like a good idea!

[DrOctaFunk]

Does this mean that any cdps under 120% currently will be liquidated?

[defiroose]

Yes, if approved on-chain. This currently represents 3,107 ADA worth of iUSD CDPs.

[defiroose]

This temp check is no longer applicable. A new temp check can be created in the future if market conditions change.