# Increase eUSDe supply cap on Euler Yield

**URL:** <https://forum.euler.finance/t/increase-eusde-supply-cap-on-euler-yield/1328>\
**Category:** Markets\
**Tags:** supply-cap\
**Created:** [March 24, 2025, 5:54am UTC](https://forum.euler.finance/t/increase-eusde-supply-cap-on-euler-yield/1328 "2025-03-24T05:54:17Z")\
**Posts on this page:** 2\
**Page:** 1

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**Author:** ![Objective](https://yyz1.discourse-cdn.com/flex007/user_avatar/forum.euler.finance/objective/32/830_2.png) [@Objective](https://forum.euler.finance/u/Objective)\
**Post date:** [March 24, 2025, 5:54am UTC](https://forum.euler.finance/t/increase-eusde-supply-cap-on-euler-yield/1328/1 "2025-03-24T05:54:17Z")

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## Summary

This proposal seeks to increase the supply cap of the Euler Yield eUSDe vault from 5M to 10M. The supply cap was hit 3 days after the official announcement. We believe this increase will further stimulate borrows in Euler Yield and keep Euler competitive with Morpho.

## Rationale

In a few days after listing, the eUSDe vault has hit its 5M supply cap on Euler. Ethereal TVL recently broke $500M [(Dune)](https://dune.com/hashed_official/ethereal). The implied yield on Pendle has settled at ~12%, indicating strong above-market interest in Ethereal’s points program. We believe eUSDe’s risk profile has not changed materially since the [assessment](https://forum.euler.finance/t/integrate-eusde-on-euler-yield-market/1287) by Gauntlet and Objective Labs earlier this month.

## Points

Last week a representative of the Ethereal [committed](https://forum.euler.finance/t/integrate-eusde-on-euler-yield-market/1287/10) to enrolling Euler in Ethereal’s points program. This is now official on Ethereal’s [dashboard](https://deposit.ethereal.trade/points), and we are happy that Euler is put on equal footing with Morpho. We believe this is a strong signal for the potential of the Euler Yield market to lead the market in eUSDe lending TVL.

## Caps

_Modified values in **bold**._

| Vault | Supply Cap | Borrow Cap |
| --- | --- | --- |
| eUSDe | 5M → **10M** | 0 |

## Author

Objective Labs is a service provider for Euler Labs tasked with product development, risk management, and incentive optimization. Objective Labs is Euler-aligned.

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**Author:** ![Gauntlet](https://yyz1.discourse-cdn.com/flex007/user_avatar/forum.euler.finance/gauntlet/32/611_2.png) [@Gauntlet](https://forum.euler.finance/u/Gauntlet)\
**Post date:** [March 24, 2025, 11:15pm UTC](https://forum.euler.finance/t/increase-eusde-supply-cap-on-euler-yield/1328/2 "2025-03-24T23:15:53Z")

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Gauntlet is aligned with this increase of the initial supply cap for eUSDe from 5M to 10M. This asset’s supply cap usage reached 100% within days of being listed, and its TVL has increased by ~$150M since our original recommendation. The new supply cap will be ~1.9% of token supply. We are amenable to increasing the supply cap given the outsize demand, while noting primary atomic liquidity still only exists through redemptions with Ethereal.