bETH collateral for baoUSD

Summary

This proposal aims to approve the addition of bETH as collateral to baoUSD

Background

We have been working towards building our vision of the best-decentralized stablecoin and part of that plan included adding bETH, our basket of staked ETH tokens as collateral. Now that bETH has launched, we can follow through on that plan.

Goals

Increase the use cases and borrow demand for baoUSD while maintaining our commitment to creating a stablecoin with decentralized collateral

Proposed Solution

Describe the solution to the problems outlined above. Include enough detail to allow for productive discussion and comments from readers.

  • add bETH to the baoUSD Vault and enable deposits
  • upgrade our liquidation bot to ensure positions can be liquidated safely

Risks

  • Lack of liquidations during high volatility: While MEV hunters should pick up any liquidations, we cannot be sure this will happen. This is mitigated by running our own liquidation bot, and in the future by deploying a baoETH backstop via b.protocol.