# PIP-37 l Deprecate wFRK as paUSD Collateral on Polygon PoS

**URL:** <https://gov.parallel.best/t/pip-37-l-deprecate-wfrk-as-pausd-collateral-on-polygon-pos/421>\
**Category:** Approved PIPs\
**Created:** [October 18, 2024, 3:11pm UTC](https://gov.parallel.best/t/pip-37-l-deprecate-wfrk-as-pausd-collateral-on-polygon-pos/421 "2024-10-18T15:11:06Z")\
**Posts on this page:** 3\
**Page:** 1

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**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:** [October 18, 2024, 3:11pm UTC](https://gov.parallel.best/t/pip-37-l-deprecate-wfrk-as-pausd-collateral-on-polygon-pos/421/1 "2024-10-18T15:11:06Z")

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**Summary:**

The proposal aims to deprecate wFRK from allowed collaterals of paUSD on Polygon PoS following the deprecation of the token by the KUMA protocol.

**Context:**

wFRK has been available as a paUSD collateral since September 2023, following DAO approval of [MIP-31](https://gov.parallel.best/t/mir-31-add-wfrk-as-collateral-for-pausd-on-parallel-on-polygon/302) and [MIP-31.1](https://gov.parallel.best/t/mir-31-1-choose-wfrk-collateral-parameters-for-pausd-on-parallel-on-polygon/309).

A few weeks ago, the KUMA DAO [decided](https://gov.kuma.bond/t/kir-3-l-deprecate-frk-on-polygon-pos/123) to deprecate FRK (and therefore wFRK) on Polygon PoS. In line with this decision, we propose to deprecate the wFRK from the allowed tokens as collateral of the paUSD on Polygon PoS.

**Rationale:**

We propose to perform the deprecation in 3 phases:

- Reduction of the debt limit to 0
- After a 4-week period, a gradual increase of 5,000 bps per day of the minimum collateral ratio and liquidation ratio will be performed until the entire debt has been repaid.
- wFRK is removed from the tokens allowed as collateral for paUSD

**Means:**

- Human Resources: Multisig signers will need to sign transactions to execute the proposal
- Treasury Resources: There will be no treasury resources needed to execute the proposal.

**Technical implementation:**

- On Polygon PoS:
  - In the paUSD ConfigProvider [contract](https://polygonscan.com/address/0x44adedae87cda45f9e9b6d49e49db5d583646163#code) the DAO [Multisig](https://app.safe.global/balances?safe=matic:0x2046c0416A558C40cb112E5ebB0Ca764c3C5c32a) will call the ‘setCollateralDebtLimit’ function with these parameters:
    - ‘\_collateralType’ : 0x01d1a890d40d890d59795afcce22f5adbb511a3a (wFRK)
    - ‘\_debtLimit’ : 0

  - In the paUSD ConfigProvider [contract](https://polygonscan.com/address/0x44adedae87cda45f9e9b6d49e49db5d583646163#code) the DAO [Multisig](https://app.safe.global/balances?safe=matic:0x2046c0416A558C40cb112E5ebB0Ca764c3C5c32a) will call the ‘setCollateralBorrowRate’ function with these parameters until the remaining debt is equal to 0:
    - ‘\_collateralType’ : 0x01d1a890d40d890d59795afcce22f5adbb511a3a (wFRK)
    - ‘\_borrowRate’ : Add 5,000 bps to the current borrow rate (managed by the DAO Multisig signers)

  - In the paUSD ConfigProvider [contract](https://polygonscan.com/address/0x44adedae87cda45f9e9b6d49e49db5d583646163#code) the DAO [Multisig](https://app.safe.global/balances?safe=matic:0x2046c0416A558C40cb112E5ebB0Ca764c3C5c32a) will call the ‘removeCollateral’ function with these parameters:
    - ‘\_collateralType’ : 0x01d1a890d40d890d59795afcce22f5adbb511a3a (wFRK)

**Voting Options:**

- Accept the Deprecation
- Against/Rework the proposal
- Abstain

Authors: @Jeanbrasse from Mimo Labs

**Sentiment poll:**

_Poll ([view on site](https://gov.parallel.best/t/pip-37-l-deprecate-wfrk-as-pausd-collateral-on-polygon-pos/421/1))_

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<div class="post-metadata">

**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:** [October 24, 2024, 11:52am UTC](https://gov.parallel.best/t/pip-37-l-deprecate-wfrk-as-pausd-collateral-on-polygon-pos/421/2 "2024-10-24T11:52:12Z")

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The proposal is now live on Snapshot from October 22th at 5pm CET until October 31st at 5pm CET: [Snapshot](https://snapshot.org/#/mimo.eth/proposal/0x604df1a21c9b0acf56fc826e25cf4b3910b9f38ca0199f1cdfac6b5247023003)

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<div class="post-metadata">

**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:** [November 1, 2024, 11:00am UTC](https://gov.parallel.best/t/pip-37-l-deprecate-wfrk-as-pausd-collateral-on-polygon-pos/421/3 "2024-11-01T11:00:05Z")

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The vote has been approved by the DAO, result: [Snapshot](https://snapshot.org/#/mimo.eth/proposal/0x604df1a21c9b0acf56fc826e25cf4b3910b9f38ca0199f1cdfac6b5247023003)