Dear Raft community,
This is Omaka from Binance Earn WBETH team. I am writing this proposal to introduce WBETH as a new collateral of R on Ethereum network. The introduction of WBETH offers a valuable prospect for enhancing diversification, expanding the spectrum of collateral assets, and consequently alleviating particular risks correlated with dependence on a restricted assortment of collateral.
WBETH Overview
WBETH is a reward-bearing liquid staking token, where 1 WBETH represents 1 ETH and the total staking rewards accrued by the ETH on ETH Staking.
WBETH will allow users to obtain immediate liquidity and participate in DeFi projects, while ensuring their eligibility to receive the corresponding ETH Staking rewards accrued.
On-chain users can stake their ETH to obtain WBETH by interacting with the WBETH smart contract. Binance users can wrap their BETH tokens to WBETH, and unwrap their WBETH to BETH tokens on the Binance ETH Staking page at zero fees.
In 4 months since its launch, WBETH has become the top 200 token by TVL, with robust liquidity on Binance platform and $40mil TVL in DeFi projects. Binance is the top 3 staking service provider, with 1.2+ mil ETH staked which represents 5% of all Ethereum staked. Taking Binance’s strong presence in ETH staking, the upside of WBETH will be huge.
Important Links
Website: Ethereum 2.0 Staking | Stake Ether & Get BETH | Binance
FAQ: What Is WBETH? | Binance Support
Guide to stake WBETH (via smart contract) Guid to stake ETH --> WBETH via smart contract - Google Docs
Contracts:
- Ethereum: Wrapped Binance Beacon ETH (wBETH) Token Tracker | Etherscan
- BNB Smart Chain: Wrapped Binance Beacon ETH (wBETH) Token Tracker | BscScan
Dune Dashboard and Markets: https://dune.com/billwang/wbeth
Risk mitigation
Market Risk
Our team understands the importance of liquidity depth of LST as collateral, so we are working with more DEX and DeFi projects to ensure low slippage trading and use cases are available on chain. Given the TVL in Binance ETH staking, there is a huge potential in the traction and liquidity depth around WBETH.
Technology Risk
Smart Contract - Binance endeavors in safety of users’ assets. All the contracts have been audited internally with the robust auditing process by our security team. Source code of the WBETH contract is open-sourced. An additional external audit was also conducted to ensure the security of the smart contracts.
Oracle - Binance Earn is working with oracle providers to ensure reliable price feed of WBETH. Binance Oracle pricefeed are ready on BNB Smart Chain. More oracles will be onboarded for price feeds on Ethereum.
Parameters
Despite the risk mitigation we have had / are working on, we are proposing the following conservative parameters for using WBETH as collateral to mint R, alongside a comparison with the existing parameters for stETH and rETH:
| stETH | rETH | WBETH | |
|---|---|---|---|
| Minimum Collateralization Requirement | 120% | 120% | 130% |
| Borrowing spread | 0.50% | 1.00% | 1.00% |
| Redemption fee | 1.5% | 2% | 2% |
| Collateral Cap | uncapped | 20,000 rETH | 750 WBETH |
| Collateral cap per Position | uncapped | 1,000 rETH | 35 WBETH |
We would be happy to adjust the above parameters based on feedback from the community and core Raft team and would be happy to answer any questions on WBETH. Adding WBETH as a market for R collateral will be mutually beneficial for both Raft and WBETH, as it will increase the utility for WBETH, while also increasing the Raft TVL and rollout of R.
