This RFC supersedes OIP-144C, which is out of date based on changes to the Cooler Loans proposal.
TAP-28 dictates that minimumPriceTarget should be a minimum of 2% spread above the Cooler Loans. Based on discussions in the Discord, it makes sense to update the logic around RBS price target to be a little higher spread than 2%. Depending on the decided-on LTB parameter (90% vs 95%), a 2% spread could be too small. Sitting at 92% of backing still opens up the possibility of people buying up well below backing and trying to extract Treasury via redemption. Pushing to 95% or above reduces the reward for the same amount of risk to those people, more effectively managing this risk.
The logic for determining minimumPriceTarget should be updated to the lesser of:
(1 + RBScushionSpread) x (Cooler Loan Amount + Backing) / 2
(1 + RBScushionSpread) x Backing x 0.99
Example: if Cooler Loan is decided to be 90% of backing, RBScushionSpread is 10%, and Backing is $11 per OHM, then minimumPriceTarget would be (1 + 0.1) * (9.9 + 11) / 2 = 11.495
The second scenario limits the lower cushion to 99% of backing, giving a bit of room for execution. This limits the lower cushion to not leak out backing, should something unexpected happen with backing changing over time.
The buffer on top exists to provide relevant optionality between taking the lower cushion and taking a Cooler loan. This should be an improvement over a static 2% spread which may not be aggressive enough depending on the Cooler Loan Amount chosen.
Vote Option 1: Approve minimumPriceTarget logic change, move forward to OIP
Vote Option 2: Reject minimumPriceTarget logic change