The Venus Protocol, a decentralized borrowing, lending, and incomes platform, has formally launched its VIP-129 governance proposal that focuses on migrating the TUSD contract on the BNB Chain.
Venus Protocol migrating TUSD contracts on BNB Chain
The migration behind VIP-129 entails minimizing the present TUSD market and introducing assist for the brand new native TUSD contract on Venus.
The goals that the proposal is ready to realize embody deploying a brand new market with a brand new BEP-20-based TUSD contract as the brand new native token. It might start deprecating or minimizing the present market that makes use of the previous BEP-20 TUSD contract, or TUSD_OLD.
Lastly, efficiently voting and implementing the VIP-129 protocol would enact adjustments in Venus’s protocol. All borrowing, supplying, and using of the present TUSD can be quickly suspended for the present TUSD market, and the market can be renamed as TUSDOLD.
Moreover, the distribution of XVS in TUSDOLD can be set to zero, whereas the distribution can be migrated to the brand new TUSD market, and be set at 12.5 XVS per day. XVS is the governance token of the Venus Protocol.
The Legacy vTUSD market will probably be upgraded and renamed Venus TUSDOLD. The reserve think about TUSD previous can be set to a most (100%), and the collateral issue can be halved (55%).
Safety and price implications
With the brand new market and native TUSD contract, the Gauntlet Community partnered with the Venus protocol by onboarding onto the BNB chain to handle market danger, enhance capital effectivity, and simulate protocol suggestions for Venus.
In keeping with that, the Gaulet Community prompt establishing particular settings till the brand new market has sufficient liquidity. These embody a collateral issue of 0%, a reserve issue of 25%, a borrowing cap of 600,000 TUSD, and a provide cap of 1,000,000 TUSD.
To make sure sufficient safety, integrating the previous vTUSD and new vTUSD markets can be examined in a simulated atmosphere to confirm performance.
Furthermore, to keep away from the implications of a liquidity scarcity, an preliminary liquidity of 10,000 TUSD will probably be supplied as bootstrap liquidity for the market. This measure would additionally assist to safeguard towards potential assaults on empty swimming pools, which have been noticed in different lending protocols.
Forward of this scheduled migration, TUSD debtors are suggested to repay their TUSDOLD loans to keep away from liquidation.
In the meantime, the Venus Protocol additionally stated Binance, in collaboration with the Tusdio workforce, will quickly launch a TUSD to TUSD_OLD Swap throughout the minimization interval of the TUSD_OLD market on Venus.