maxDebt was configured to be sUSD 50 million in SCCP-88 but has long been surpassed, this sccp proposed to increase it to sUSD 65 million given the increased demand for shorts, following the recent temporary increase in snx rewards.
The cap can be increased to sUSD 65 million to allow more users to take loans and shorts.
Due to the recent increase in snx rewards paid on sETH shorts, total debt had increased beyound the sUSD 50 million
maxDebt previously configured, as can be seen in the table below:
Rewards on sETH shorts now amount to 24k SNX per week, due to the transition from sDAO funding to inflationary supply funding as per SCCP-89. With the current cap being reached, users are not able to open shorts on sBTC or sETH, resulting in the APY on shorts surging to 100%, while it was 50% pre-reward boost. Therefore this SCCP suggests to increase
maxDebt to sUSD 65 million and to revise it gradually lower in future if excess capacity isn’t fully utilized, as rewards are decreased back down.
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