Proposal 7: Increase the Liquidation Penalty Rate of ETH-PERP

Due to the high gas recently, the Keeper’s profit curve for clearing unsafe accounts is bad. According to the design, anyone can be a keeper, but there are not enough reasons to become a keeper now. This greatly increases the system’s risks.

We propose to increase the liquidation penalty rate of ETH-PERP.

  • Old Penalty Rate: 2.5% (1% to the insurance fund + 1.5% to the Keeper).
  • Proposed Value: 7.5% (3% to the insurance fund + 4.5% to the Keeper).
  • Note that the maintenance margin rate is 7.5%.

The new parameter basically means that the keeper can completely liquidate the user when the margin is lower than 7.5%. This parameter can also prevent too many small position accounts after being partially liquidated.

Vote Quorum: 10,000 MCB.

Please vote at:
https://vote.mcdex.io/mainnet/proposal/5