# Make Euler Prime more attractive for LST/LRT looping **URL:** \ **Category:** Markets\ **Created:** [March 19, 2025, 9:49am UTC](https://forum.euler.finance/t/make-euler-prime-more-attractive-for-lst-lrt-looping/1325 "2025-03-19T09:49:30Z")\ **Posts on this page:** 3\ **Page:** 1
**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 19, 2025, 9:49am UTC](https://forum.euler.finance/t/make-euler-prime-more-attractive-for-lst-lrt-looping/1325/1 "2025-03-19T09:49:30Z")
# Summary Euler Labs has recently received requests from large borrowers looking to loop LST/LRTs against WETH on Euler Prime. This activity is a major contributor to sticky TVL in the ETH-cluster assets on competing lending protocols. This proposal aims make Euler Prime a more attractive venue for these borrowers. # LTVs _Modified values in **bold**._ | Collateral | Debt | Borrow LTV | LLTV | | --- | --- | --- | --- | | wstETH | WETH | 91% → **93%** | 93% → **95%** | | cbETH | WETH | 91% → **93%** | 93% → **95%** | | rETH | WETH | 88% → **93%** | 93% → **95%** | | weETH | WETH | 91% | 93% | | ezETH | WETH | 88% → **91%** | 90% → **93%** | | rsETH | WETH | 88% → **91%** | 90% → **93%** | | mETH | WETH | 88% → **91%** | 90% → **93%** | | ETHx | WETH | 85% → **91%** | 87% → **93%** | This adjustment puts ETH derivative assets in two risk tiers. LTVs are increased to make parameters in Euler Prime competitive with Aave’s E-mode on the Core instance. # IRMs _All rates are borrow APY. Modified values in **bold**._ | Asset | Base rate | Kink | Rate at kink | Rate at 100% (max) | | --- | --- | --- | --- | --- | | WETH | 0% | 85% → **90%** | 2.5% → **2.7%** | 80% | This adjustment unlocks another 5% of WETH supply to be borrowed. It supplements the WETH lending rate by 0.2 percentage points, while lining up the borrow rate with equivalent markets on Aave and Morpho. # Caps _Modified values in **bold**._ | Asset | Supply cap | Borrow cap | | --- | --- | --- | | WETH | 25,000 → **50,000** | 21,250 → **45,000** | | weETH | 6,250 → **20,000** | 1,562.5 → **5,000** | | rsETH | 6,250 → **20,000** | 1,562.5 → **5,000** | | ezETH | 6,250 → **20,000** | 1,562.5 → **5,000** | # Incentives We propose that the implementation of this proposal be paired with a rEUL incentive campaign for the Euler Prime WETH vault. Next to that, we are anticipating a points integration for rsETH. # Visibility We are reaching out to the issuers of these assets to feature the Euler Prime vaults on their respective DeFi opportunities pages. # Author Objective Labs is a service provider for Euler Labs tasked with product development, risk management, and incentive optimization. Objective Labs is Euler-aligned. ---
**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 20, 2025, 5:13am UTC](https://forum.euler.finance/t/make-euler-prime-more-attractive-for-lst-lrt-looping/1325/2 "2025-03-20T05:13:55Z")
# Gauntlet - WETH/LST Looping Recommendations on Euler Prime (2025-03-20) Gauntlet has reviewed this proposal by Objective Labs, and we are supportive of updating market parameters on Euler Prime to support further capital efficiency enhancements for WETH/LST looping. In light of the current market conditions, we are aligned with the recommendations in this proposal, except with the following changes: # LTVs | **Collateral** | **Debt** | **Borrow LTV** | **LLTV** | | --- | --- | --- | --- | | cbETH | WETH | Unchanged | Unchanged | cbETH currently has the lowest 10% price impact swap amount to WETH on Ethereum, at less than 1,000. Its current LLTV of 93% and Borrow LTV of 91% are commensurate with this liquidity. # Caps | **Asset** | **Supply cap** | **Borrow cap** | | --- | --- | --- | | weETH | 6,250 → **13,000** | 1,562.5 → **3,125** | | rsETH | 6,250 → **13,000** | 1,562.5 → **3,125** | | ezETH | 6,250 → **13,000** | 1,562.5 → **3,125** | We recommend reserving any outsize increases in excess of 100% until caps are sufficiently utilized again. ---
**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 20, 2025, 5:27am UTC](https://forum.euler.finance/t/make-euler-prime-more-attractive-for-lst-lrt-looping/1325/3 "2025-03-20T05:27:34Z")
Thank you @Gauntlet team for pointing out this important nuance related to cbETH. We are also aligned with the more moderate cap increases. We will monitor cap utilization closely and will be proactive should the new caps get filled.