# MIR-32┃Adjust PAR Borrow Rates on Ethereum & Polygon PoS **URL:** \ **Category:** Approved PIRs\ **Created:** [January 17, 2024, 11:10pm UTC](https://gov.parallel.best/t/mir-32-adjust-par-borrow-rates-on-ethereum-polygon-pos/326 "2024-01-17T23:10:53Z")\ **Posts on this page:** 6\ **Page:** 1
**Author:** ![JeanBrasse](https://dub1.discourse-cdn.com/flex005/user_avatar/gov.parallel.best/jeanbrasse/32/28_2.png) [@JeanBrasse](https://gov.parallel.best/u/JeanBrasse)\ **Post date:** [January 17, 2024, 11:10pm UTC](https://gov.parallel.best/t/mir-32-adjust-par-borrow-rates-on-ethereum-polygon-pos/326/1 "2024-01-17T23:10:54Z")
**Summary:** This proposal aims to adjust PAR borrow rates on Ethereum & Polygon PoS. **Rationale:** Following [MIP-19](https://gov.parallel.best/t/mip-19-adjust-tokens-collateral-parameters-for-par-on-ethereum/320), [MIP-20](https://gov.parallel.best/t/mip-20-adjust-tokens-collateral-parameters-for-par-on-polygon-pos/321), [MIP-21](https://gov.parallel.best/t/mip-21-adjust-tokens-collateral-parameters-for-pausd-on-ethereum/322) & [MIP-22](https://gov.parallel.best/t/mip-22-adjust-tokens-collateral-parameters-for-pausd-on-polygon-pos/323), which raised minimum borrow rates to 1.80% per year in line with recent market conditions changes (ECB rates increased, main CDP borrow rates increase), we propose to continue in this direction by increasing minimum borrow rates to 4.20% per year. This will help both adjusting demand/offer (PAR peg) and increasing protocol revenues. Moreover, protocol revenues from PAR borrow rates would grow from around $120k per year to $285k. Below are the current borrow rates for tokens allowed as collateral for PAR on Ethereum: ![](https://europe1.discourse-cdn.com/flex005/uploads/mimo1/original/1X/3b4773c7d3c9ae91bbde36a66302a73fa2966e51.png) (More details available [here](https://docs.google.com/spreadsheets/d/1g0PYn8E85vo0J3xO1nW2k_Ny-oVtfwN4Ol4y_iIxHUY/edit?usp=sharing)) We propose to adjust borrow rates for tokens allowed as collateral as follows: ![](https://europe1.discourse-cdn.com/flex005/uploads/mimo1/original/1X/514e5dfeeeba2633f4ba3d59cb8a40ee594c670d.png) (In blue the proposed changes, more details available [here](https://docs.google.com/spreadsheets/d/1g0PYn8E85vo0J3xO1nW2k_Ny-oVtfwN4Ol4y_iIxHUY/edit?usp=sharing)) Below are the current borrow rates for tokens allowed as collateral for PAR on Polygon PoS: ![](https://europe1.discourse-cdn.com/flex005/uploads/mimo1/original/1X/42e33fce0c69c6952d5435ff84f44a398b1b4a60.png) (More details available [here](https://docs.google.com/spreadsheets/d/1g0PYn8E85vo0J3xO1nW2k_Ny-oVtfwN4Ol4y_iIxHUY/edit?usp=sharing)) We propose to adjust borrow rates for tokens allowed as collateral as follows: ![](https://europe1.discourse-cdn.com/flex005/uploads/mimo1/original/1X/9a3b38413aec09602098ef1e46475e8328cc8e2d.png) (In blue the proposed changes, more details available [here](https://docs.google.com/spreadsheets/d/1g0PYn8E85vo0J3xO1nW2k_Ny-oVtfwN4Ol4y_iIxHUY/edit?usp=sharing)) **Means:** - Human Resources: Multisig signers will need to adjust PAR borrow rates on Ethereum & Polygon PoS Multisigs. - Treasury Resources: There is no cost for the treasury to adjust PAR borrow rates on Ethereum & Polygon PoS. **Technical Implementation:** On Ethereum, Parallel DAO [multisig](https://app.safe.global/home?safe=eth:0x25Fc7ffa8f9da3582a36633d04804F0004706F9b) will call following smart contracts: - PAR ConfigProvider [contract](https://etherscan.io/address/0xaa4cb7dbb37dba644e0c180291574ef4e6abb187#writeContract): - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0xa0b86991c6218b36c1d19d4a2e9eb0ce3606eb48 (USDC) - ‘\_borrowRate’ : 1000000001304602465690389264 (4.20% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0xc02aaa39b223fe8d0a0e5c4f27ead9083c756cc2 (wETH) - ‘\_borrowRate’ : 1000000001304602465690389264 (4.20% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0x2260fac5e5542a773aa44fbcfedf7c193bc2c599 (wBTC) - ‘\_borrowRate’ : 1000000001304602465690389264 (4.20% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0xD533a949740bb3306d119CC777fa900bA034cd52 (CRV) - ‘\_borrowRate’ : 1000000001304602465690389264 (4.20% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0xba100000625a3754423978a60c9317c58a424e3d (BAL) - ‘\_borrowRate’ : 1000000001304602465690389264 (4.20% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0x7fc66500c84a76ad7e9c93437bfc5ac33e2ddae9 (AAVE) - ‘\_borrowRate’ : 1000000001304602465690389264 (4.20% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0x514910771af9ca656af840dff83e8264ecf986ca (LINK) - ‘\_borrowRate’ : 1000000001304602465690389264 (4.20% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0x6b3595068778dd592e39a122f4f5a5cf09c90fe2 (SUSHI) - ‘\_borrowRate’ : 1000000001304602465690389264 (4.20% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0x7f39c581f595b53c5cb19bd0b3f8da6c935e2ca0 (wstETH) - ‘\_borrowRate’ : 1000000001395766281313196628 (4.50% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0xaf4ce7cd4f8891ecf1799878c3e9a35b8be57e09 (wUSK) - ‘\_borrowRate’ : 1000000001395766281313196628 (4.50% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : not yet deployed (wFRK) - ‘\_borrowRate’ : 1000000001395766281313196628 (4.50% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0x03ab458634910AaD20eF5f1C8ee96F1D6ac54919 (RAI) - ‘\_borrowRate’ : 1000000001304602465690389264 (4.20% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0x5f98805A4E8be255a32880FDeC7F6728C6568bA0 (LUSD) - ‘\_borrowRate’ : 1000000001304602465690389264 (4.20% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0xBe9895146f7AF43049ca1c1AE358B0541Ea49704 (cbETH) - ‘\_borrowRate’ : 1000000001395766281313196628 (4.50% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0xae78736cd615f374d3085123a210448e74fc6393 (rETH) - ‘\_borrowRate’ : 1000000001395766281313196628 (4.50% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0xac3E018457B222d93114458476f3E3416Abbe38F (sfrxETH) - ‘\_borrowRate’ : 1000000001395766281313196628 (4.50% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0x6B175474E89094C44Da98b954EedeAC495271d0F (DAI) - ‘\_borrowRate’ : 1000000001304602465690389264 (4.20% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0x853d955acef822db058eb8505911ed77f175b99e (FRAX) - ‘\_borrowRate’ : 1000000001304602465690389264 (4.20% p.y) On Polygon PoS, Parallel DAO [multisig](https://app.safe.global/balances?safe=matic:0x2046c0416A558C40cb112E5ebB0Ca764c3C5c32a) will call following smart contracts: - PAR ConfigProvider [contract](https://polygonscan.com/address/0xcae2cae9a4384b196c0f1bae59724e0eb9a347e0#contracts): - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0x2791Bca1f2de4661ED88A30C99A7a9449Aa84174 (USDC.e) - ‘\_borrowRate’ : 1000000001304602465690389264 (4.20% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0x7ceB23fD6bC0adD59E62ac25578270cFf1b9f619 (wETH) - ‘\_borrowRate’ : 1000000001304602465690389264 (4.20% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0x1BFD67037B42Cf73acF2047067bd4F2C47D9BfD6 (wBTC) - ‘\_borrowRate’ : 1000000001304602465690389264 (4.20% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0x172370d5Cd63279eFa6d502DAB29171933a610AF (CRV) - ‘\_borrowRate’ : 1000000001304602465690389264 (4.20% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0x9a71012B13CA4d3D0Cdc72A177DF3ef03b0E76A3 (BAL) - ‘\_borrowRate’ : 1000000001304602465690389264 (4.20% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0xD6DF932A45C0f255f85145f286eA0b292B21C90B (AAVE) - ‘\_borrowRate’ : 1000000001304602465690389264 (4.20% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0x53E0bca35eC356BD5ddDFebbD1Fc0fD03FaBad39 (LINK) - ‘\_borrowRate’ : 1000000001304602465690389264 (4.20% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0x0b3F868E0BE5597D5DB7fEB59E1CADBb0fdDa50a (SUSHI) - ‘\_borrowRate’ : 1000000001304602465690389264 (4.20% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0x8f3Cf7ad23Cd3CaDbD9735AFf958023239c6A063 (DAI) - ‘\_borrowRate’ : 1000000001304602465690389264 (4.20% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0x03b54A6e9a984069379fae1a4fC4dBAE93B3bCCD (wstETH) - ‘\_borrowRate’ : 1000000001395766281313196628 (4.50% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : not yet deployed (wUSK) - ‘\_borrowRate’ : 1000000001395766281313196628 (4.50% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0x01d1a890D40d890d59795aFCce22F5AdbB511A3a (wFRK) - ‘\_borrowRate’ : 1000000001395766281313196628 (4.50% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0x0d500B1d8E8eF31E21C99d1Db9A6444d3ADf1270 (wMATIC) - ‘\_borrowRate’ : 1000000001304602465690389264 (4.20% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0x3A58a54C066FdC0f2D55FC9C89F0415C92eBf3C4 (stMATIC) - ‘\_borrowRate’ : 1000000001395766281313196628 (4.50% p.y) - Call ‘SetCollateralBorrowRate’ function with these parameters: - ‘\_collateralType’ : 0xfa68FB4628DFF1028CFEc22b4162FCcd0d45efb6 (MaticX) - ‘\_borrowRate’ : 1000000001395766281313196628 (4.50% p.y) **Voting Options:** - For the adjustment - Against the adjustment - Abstain Author: @jeanbrasse & @Starny from Mimo Labs. **Community poll:** _Poll ([view on site](https://gov.parallel.best/t/mir-32-adjust-par-borrow-rates-on-ethereum-polygon-pos/326/1))_ ---
**Author:** ![Squirrely](https://dub1.discourse-cdn.com/flex005/user_avatar/gov.parallel.best/squirrely/32/202_2.png) [@Squirrely](https://gov.parallel.best/u/Squirrely)\ **Post date:** [January 19, 2024, 9:52am UTC](https://gov.parallel.best/t/mir-32-adjust-par-borrow-rates-on-ethereum-polygon-pos/326/2 "2024-01-19T09:52:46Z")
Hello May I kindly ask why we want to increase the B/R further? Because we have already raised two weeks ago. Are we for example awaiting a bigger inflow of capital and therefore need to ensure that there is sufficient over-collaterisation to ensure the peg in difficult market conditions? Maybe we could also display our low B/R in comparison to others and raise visibility for our protocol and pool? ---
**Author:** ![JeanBrasse](https://dub1.discourse-cdn.com/flex005/user_avatar/gov.parallel.best/jeanbrasse/32/28_2.png) [@JeanBrasse](https://gov.parallel.best/u/JeanBrasse)\ **Post date:** [January 19, 2024, 3:37pm UTC](https://gov.parallel.best/t/mir-32-adjust-par-borrow-rates-on-ethereum-polygon-pos/326/3 "2024-01-19T15:37:08Z")
Hey, increase borrow rates isn’t a question of overcollateralization, by design the protocol is overcollateralized, regardless of borrow rates. Its related to market conditions, with the recent crypto prices increasing, users are once again seeking exposure to cryptos, and therefore leverage (borrow rates on [Aave](https://app.aave.com/markets/) and [Curve](https://crvusd.curve.fi/#/ethereum/markets) are currently around 15% APR on USD stablecoins). The market demand for leverage increased the PAR supply which began to depeg the price of PAR against EUR (it cost less to borrow and leverage on Parallel than on any other protocol right now). In order to maintain the PAR peg and reduce selling pressure, we propose to increase borrow rates. This would also increase yearly protocol revenues from borrow rates from $120k to around $285k. ---
**Author:** ![Squirrely](https://dub1.discourse-cdn.com/flex005/user_avatar/gov.parallel.best/squirrely/32/202_2.png) [@Squirrely](https://gov.parallel.best/u/Squirrely)\ **Post date:** [January 19, 2024, 9:28pm UTC](https://gov.parallel.best/t/mir-32-adjust-par-borrow-rates-on-ethereum-polygon-pos/326/4 "2024-01-19T21:28:59Z")
Appologize, I mixed up something there. Thank you for clarification. ---
**Author:** ![starny](https://dub1.discourse-cdn.com/flex005/user_avatar/gov.parallel.best/starny/32/32_2.png) [@starny](https://gov.parallel.best/u/starny)\ **Post date:** [January 22, 2024, 8:41am UTC](https://gov.parallel.best/t/mir-32-adjust-par-borrow-rates-on-ethereum-polygon-pos/326/5 "2024-01-22T08:41:26Z")
Vote is live: [Snapshot](https://snapshot.org/#/mimo.eth/proposal/0x8a679f6b332af9b123af2dffc7e37c60c9b4bc6c46c9e9beecdab49e126df923) ---
**Author:** ![starny](https://dub1.discourse-cdn.com/flex005/user_avatar/gov.parallel.best/starny/32/32_2.png) [@starny](https://gov.parallel.best/u/starny)\ **Post date:** [January 25, 2024, 11:43am UTC](https://gov.parallel.best/t/mir-32-adjust-par-borrow-rates-on-ethereum-polygon-pos/326/6 "2024-01-25T11:43:06Z")
The proposal has been approved by the DAO, result: [Snapshot](https://snapshot.org/#/mimo.eth/proposal/0x8a679f6b332af9b123af2dffc7e37c60c9b4bc6c46c9e9beecdab49e126df923)