This proposal advocates for an upgrade to runtime version 1.25.4, focusing on refining premium redeem logic. To avoid unjustly burdening vaults, only award premiums for the tokens required to restore the vault to its secure threshold. This greatly reduces the financial risk for vault operators while remaining a financial incentive for network participants to redeem against vaults with a low collateralization ratio.
Consider the following values for Vault A
If the User redeems 650 tokens through Vault A
After the proposed changes are done
For more detailed info take a look at the release tag: https://github.com/interlay/interbtc/releases/tag/1.25.4
Interlay, a blockchain-based platform, has proposed an upgrade to its runtime version 1.25.4.
The upgrade aims to refine premium redeem logic to reduce the financial risk for vault operators.
The proposal suggests that only premiums for the tokens required to restore the vault to its secure threshold should be awarded.
This way, network participants can redeem against vaults with a low collateralization ratio while avoiding unjustly burdening vaults.
The proposal provides an example of how the upgrade will work with Vault A.