Pentera Capital Proposes To Increase WBTC Collateral Factor To 75%

Franklin Bi, DeFi builder at Pantera Capital, just stated in a thread of tweets that, on behalf of Pantera Capital, he proposed to increase WBTC Collateral Factor to 75% on Compound Finance.

Compound assigns a "Collateral Factor" to each asset to calculate how much a user can borrow when using that asset as collateral. And wBTC's Collateral Factor today is 60%, indicating that if users supply $100 of wBTC to Compound Finance, they can borrow up to $60 of another asset.

He mentioned that wBTC has become a less risky asset to hold as collateral. As of today (Feb 2), there's ~$4 billion of wBTC in circulation on Ethereum and ~$250 million in daily trading volumes across major DEX and CEX pairs.

In addition, Aave's currently has wBTC's Collateral Factor set to 75%. That means it's more capital-efficient to borrow against wBTC on Aave instead of Compound.

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