Disabling XAI as collateral

TL;DR

• Starting May 14, 2023, we are disabling XAI as collateral in some markets.

• The action doesn't impact any users of the protocol.

• This action impacts the following markets: cbETH; FRAX; LINK; LUSD; wstETH; XAI-WETH and many more (see the full list below).

• This action does NOT impact the following markets: rETH; OHM.

• Users can still borrow XAI normally.

• Users will not be able to borrow against XAI deposits going forward.

How does this change impact you?

As of May 4, 2023, the change will NOT impact users with active positions since we only apply it in markets where XAI is not used as collateral.

You are OK if you're borrowing XAI

Example: A user borrowing XAI with USDC collateral will NOT experience any liquidation event.

In brief, disabling XAI as collateral means the following:

• You can still borrow XAI in a normal fashion but you cannot use XAI as collateral to borrow other assets in the isolated markets.

• XAI deposits do not improve your Health Factor.

• You still earn interest on XAI deposits when it is borrowed out.

Impacted markets

On May 14, 2023, we will disable XAI as collateral in the following markets. Users who are using XAI to borrow other assets will be liquidated instantly after the change goes into effect.

If you are using XAI as collateral to borrow other assets in any of the markets listed in the table below, repay your loan immediately. Otherwise, you will be liquidated.

Impacted markets
cbETH
USDC
QNT
DAI
FRAX
LINK
LUSD
USDT
wstETH
XAI-WETH
CRV
CVX
gOHM
MKR
RAI
SNX
WBTC
YFI
1INCH
BAL
FXS
RPL
ALCX
LQTY

Markets excluded from this action

XAI will continue to be accepted as collateral in rETH, OHM, and AURA markets until all users have closed out their loans that are backed by XAI.

Resources

Read the soft proposal on our governance forum and snapshot that we published to gauge the community's temperature about disabling XAI as collateral.