Proposed Actions for WBTC Risk Mitigation

BA Labs has proposed a set of parameter changes on the Maker Forum to mitigate risks associated with WBTC collateral within the Maker Protocol's core WBTC vaults and SparkLend.

These changes, which aim to halt new borrowings against WBTC collateral, will be put to an upcoming Executive Vote. If approved, the changes will not impact existing borrowing positions in either the Maker Protocol's core WBTC vaults or SparkLend; they will only prevent any further borrowing against WBTC.

Below is a breakdown of the proposed parameter changes:

Core vaults:

• WBTC-A DC-IAM line (max DC): Decrease to 0.

• WBTC-B DC-IAM line (max DC): Decrease to 0.

• WBTC-C DC-IAM line (max DC): Decrease to 0.

SparkLend:

• Disable WBTC borrowing.

• Reduce WBTC LTV from 74% to 0%.

Users who have already borrowed against WBTC collateral in the Maker Protocol's core WBTC vaults or on SparkLend will not experience any changes to their existing positions or borrowing parameters as a result of these changes being implemented.

BA Labs, as part of the Stability Advisory Council, will evaluate additional steps based on ongoing assessments of the risks associated with WBTC as collateral in both the Maker Protocol's core vaults and SparkLend.