Phoenix Labs proposed to disable sUSDS and sDAI as collateral in SparkLend.

According to Techub News, Phoenix Labs has proposed on the Sky (formerly MakerDAO) forum to discontinue the use of sUSDS and sDAI as collateral in SparkLend to reduce the tail risk factors that SparkLend faces with respect to other assets. Phoenix Labs stated that the historical utilization rates of sUSDS and sDAI as collateral are low, and although Sky, DAI, and USDS have very low risks, it is expected that removing these lesser-used collateral features will be welcomed by institutional users and drive long-term market growth. On the operational level, it plans to implement this discontinuation by setting the supply cap for each asset to 1 Token (thereby preventing any new supply) and setting the maximum LTV for each asset to 0%.

In addition, it plans to update the PYUSD interest rate model in SparkLend, adopting a higher benchmark interest rate based on the Sky Savings rate.