[RFC] Adding OHM as new collateral on Vesta


This proposal aims to replace the gOHM Vault and add OHM as a new collateral type on Vesta. Olympus is building OHM, a community-owned, decentralized and censorship-resistant reserve currency that is asset-backed, deeply liquid and used widely across Web3. Additionally, Vesta would benefit from the increased diversity of supported assets and attract OHM holders for TVL growth.


Diversification: Adding OHM to our collateral pool provides diversification and also helps to mitigate risk and increase the stability of VST.

Deep Liquidity: OHM has over 5m in protocol owned liquidity deployed on Arbitrum, enabling efficient vault operations, such as repayments and liquidations. This also puts OHM in a great position to increase the efficiency of VST through direct pairs or pairing with FRAX to open up routing through the existing VST liquidity on Curve.

Strong Backing: At the time of writing, OHM has a $220m treasury with over 185m of liquid assets backing OHM supporting OHM via the RBS system. This makes OHM one of the most reliable assets in crypto.

Deprecation of staking: The staking rate of gOHM will be reduced to zero in the coming months, making it an inferior collateral compared to OHM (see below).

More secure and versatile collateral: OHM is native on Arbitrum enabled by cross-chain messaging via LayerZero, making it more secure and versatile than gOHM which is a bridged synthetic. OHM can be bridged to and from Ethereum instantly with zero slippage fees.

OHM and Olympus

ERC-20: https://arbiscan.io/address/0xf0cb2dc0db5e6c66B9a70Ac27B06b878da017028

Liquidity: https://app.balancer.fi/#/arbitrum/pool/0x89dc7e71e362faf88d92288fe2311d25c6a1b5e0000200000000000000000423

Oracle (Chainlink): https://data.chain.link/arbitrum/mainnet/crypto-usd/ohmv2-usd

Olympus Website - https://www.olympusdao.finance/

App Interface - https://app.olympusdao.finance/

Documentation - https://docs.olympusdao.finance/

Github - OlympusDAO · GitHub

Audits - 1st Audit (Peckshield), 2nd Audit (Omniscia)

Governance - Scattershot (fork of Snapshot)

Community Discord - Olympus

DAO Discord - Olympus DAO Server

Twitter - https://twitter.com/OlympusDAO


We’d like to invite Warden Finance to provide us with the following parameters:

  • Minimum Collateral Ratio
  • Debt Ceiling
    • Initial
    • Scaling
  • Liquidation Penalty
  • Vesta Reference Rate Category

Risk Assessment

As with any cryptocurrency, integrating OHM as collateral carries specific risks. However, these risks can be mitigated through proper risk management practices and the proposed parameters:

Smart contract risk: Olympus protocol’s OHM token has undergone multiple audits with no critical issues found. However, as with any DeFi protocol, there remains a risk of unforeseen smart contract vulnerabilities.

Counterparty risk: As of now, the Olympus protocol has a large number of OHM token holders, indicating widespread distribution and usage. The protocol is governed by the decentralized Olympus DAO, mitigating single point of failure risks.

Market risk: OHM is subject to price volatility, as with any cryptocurrency. However, volatility has been greatly reduced since the implementation of Range Bound Stability with a 30-day volatility of under 1%. Additionally, a proposed liquidation ratio of 150% and a starting debt ceiling (to be determined based on liquidity depth) should provide adequate protection against typical market fluctuations.


This poll/discussion period will be live for a week and if passed, the official voting will commence immediately and will take place over three days.