SIP-X: Ramp up the Amplification Coefficient of Frax pools

Summary

Ramp up the Amplification Coefficient of the FRAXBP and a selection of its constituent metapools.

Abstract

This SIP seeks to increase the Amplification Coefficient [known as, the ‘A’ parameter] of the FRAXBP and FRAXBP metapools on Mainnet and Arbitrum.

Motivation

Increasing the Amplification Coefficient of the FRAXBP metapools, and the FRAXBP itself, stands to give them a competitive depth and performance analogous to the industry standard.

The higher a pool’s Amplification Coefficient is, the wider the range of no-or-low-slippage swaps is. Lower slippage implies more competitive rates and greater volume, which will positively benefit both LPs and the protocol.

Specification

The multisig will queue txn’s to increase Amplification Coefficients according to the following table:

Pool Chain Current A Proposed A
FRAX-USDC-BP Mainnet 1000 1500
FRAXBP-SUSD Mainnet 200 500
FRAXBP-USDT Mainnet 200 800
FRAX-USDC-BP Arbitrum 500 1000
FRAXBP-USDs Arbitrum 100 400
FRAXBP-USDT Arbitrum 100 400

[Note: The Amplification Coefficient will change over time as transactions occur, eventually reaching the target set by this proposal. The Amplification Coefficient may only increase by a maximum of 2x over the span of two weeks-- Meaning it may take some metapools up to 1 month to reach their desired ‘A’ value.]

For: Increase the amplification coefficients of Saddle Pools in accordance with the table above over the coming weeks.

Against: No change.

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