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v3-201-aave-v3-Ethereum-PYUSD-campaign.md

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Proposal 201. PYUSD Reserve Configuration Update & Incentive Campaign


Voting link

https://vote.onaave.com/proposal/?proposalId=201


Governance forum discussion

https://governance.aave.com/t/arfc-pyusd-reserve-configuration-update-incentive-campaign/19573/2


Payloads


Certora analysis


Proposal types

🔧 📊 configuration update

🤝 permission granting or revoking

💰 🧾 asset transfer


Context

This proposal aims to enhance the adoption and liquidity of PayPal’s stablecoin, PYUSD, on the Aave platform. By adjusting the reserve settings for PYUSD and implementing a six-month incentive campaign, it seeks to make PYUSD borrowing more attractive, offering up to 4% APR in rewards for Aave users. Additionally, a liquidity pool on Balancer is proposed to support PYUSD/GHO trading, with further incentives provided by PayPal and Trident Digital. This dual effort is intended to increase PYUSD’s utility and improve its liquidity, making it a more viable asset within DeFi.


Proposal creation

Transaction: https://etherscan.io/tx/0x2038734975b9e5407ceb1417d5d8dff4fc25c8abad9d641a526171f5edc4aced

- proposalId: 201
- creator: 0x57ab7ee15ce5ecacb1ab84ee42d5a9d0d8112922
- accessLevel: 1
- ipfsHash: 0x60f540e34c1b586a245dc16025098ca382fde4d9cb104a8c04a39745f3a7ea81

createProposal() parameters

{
  "payloads": [ 
    { 
      "chain": "1", 
      "accessLevel": "1", 
      "payloadsController": "0xdAbad81aF85554E9ae636395611C58F7eC1aAEc5", 
      "payloadId": "207" 
    }, 
  ], 
  "votingPortal": "0x9b24C168d6A76b5459B1d47071a54962a4df36c3", 
  "ipfsHash": "0x60f540e34c1b586a245dc16025098ca382fde4d9cb104a8c04a39745f3a7ea81" 
}

Aave Seatbelt report

Proposal report

https://github.com/bgd-labs/seatbelt-gov-v3/blob/main/reports/proposals/201.md

Payload reports


Technical analysis

We have verified that the proposal payload does the following:

  1. Adjusts PYUSD Reserve Parameters on Aave v3:

    • Borrow Cap: Sets the borrow cap for PYUSD to 15 million.
    • Loan-to-Value (LTV): Configures LTV at 75%.
    • Liquidation Threshold (LT): Sets LT to 78%.
    • Liquidation Penalty: Establishes a liquidation penalty of 7.5%.
    • Liquidation Protocol Fee: Applies a 10% liquidation protocol fee.

  2. Approves a 300,000 GHO Allocation to the Aave Liquidity Coordinator (ALC SAFE):

    • Enables the Aave Collector to approve 300,000 GHO to the ALC SAFE address, facilitating liquidity support for the PYUSD/GHO pool on Balancer.

  3. Sets Emission Admin Rights for PYUSD and aEthPYUSD:

    • Grants ACI_TREASURY control over emissions for both PYUSD and aEthPYUSD.

The proposal is consistent with the description on both Snapshot and the governance forum.


Certora validations

✅ The code on the proposal payload corresponds to the proposal specification.

✅ The proposal includes a proper tests suite, checking all necessary post-conditions.

✅ BGD reviewed the payload before the proposal was submitted.

✅ Certora reviewed the procedure followed to submit the proposal.