This SCCP proposes to update the following parameters:
- Double the PEPE max market value to 2.4 trillion from 1.2 trillion previously (i.e. to 4m$)
- Double the BNB max market value to 40k from 20k (i.e. to 9.5m$)
- Lower the skewScale on PEPE to 30 trillion from 37 trillion
Below is a description of the parameter being changed:
maxMarketValueis the maximum amount of open interest allowed on long and short positions in a given perp market.
skewScaleis a scaling parameter that helps calibrate the amount of slippage (or price improvement) a position receives when a position is modified. It also is a parameter that affects the speed by which funding rate changes.
The motivation behind these changes are as follows:
- PEPE and BNB having high utilization, which exceeds 75%, would benefit from the
maxMarketValueincrease. It is worth noting that the open interest exposure on synthetix's side is far below that available on other trading venues, so the changes denoted in this SCCP are still fairly conservative.
- Lowering the skewScale parameter on PEPE, helps incentivize large volume arbitrages that neutralize a skew, taking into account the slippage incurred on other trading venues.
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