renamed

Author: anajuliabit

proposals/mips/mip-b52/b52.md

@@ -0,0 +1,103 @@
+## MIP-B52: Bad Debt Remediation
+
+### **Summary**
+
+This proposal implements Anthias Labs' recommended actions to remediate the
+outstanding bad debt within select markets on Moonwell's Base implementation
+resulting from events which took place on October 10th, 2025 and November
+4th, 2025. This proposal also formalizes an allocation strategy for distributing
+excess reserves between cbXRP and VIRTUAL, based on both proportional debt share
+and contributor feedback on interest-rate dynamics.
+
+### **Background**
+
+Anthias has conducted a reserve and risk assessment on Moonwell Base following
+the two major incidents that produced bad debt in multiple markets. Their
+analysis included a review on current protocol reserve balances, updated minimum
+reserve targets, outstanding bad debt, and the proper distribution of excess
+reserves available for repayment among the highest interest markets.
+
+Moonwell holds approximately 1.89M USD in reserves, distributed across assets
+like WETH, USDC, cbBTC, AERO, etc. Significant idle reserves exist in WETH,
+USDC, and cbBTC. These reserves can partially or fully cover existing bad debt
+without external funding.
+
+Anthias has identified 5.25M USD in required reserves to fully remediate all bad
+debt, with the largest deficits concentrated in cbXRP (2.57M USD), VIRTUAL
+(1.96M USD), AERO (248K USD), and other markets like MORPHO, EURC, and cbETH. No
+single market's bad debt can be resolved using only its own reserves,
+necessitating a coordinated proposal.
+
+### **Proposal**
+
+This proposal enacts the following changes on Moonwell Base only:
+
+1. Limit Reserve Auctions During Bad-Debt Remediation
+
+   - Reserve auctions on Base (and OP Mainnet, where applicable) will be limited
+     and minimized while bad debt is being repaid.
+   - Auctions will not be fully halted; contributors may still conduct small or
+     periodic auctions when necessary or when the opportunity arises.
+   - The intention is to conserve reserves during the remediation period while
+     maintaining flexibility for contributors.
+
+2. Redirect 100% of Reserve Accruals Toward Bad-Debt Repayment
+
+   - All future reserve income (interest margin, liquidation fees, protocol
+     revenue) will go directly to paying down outstanding bad debt.
+
+3. Utilize Excess Reserves in WETH, USDC, and cbBTC
+
+   - Anthias identifies significant excess reserves in these markets.
+   - Authorise their use to cover bad debt, starting with:
+     1. cbXRP
+     2. VIRTUAL
+     3. AERO, MORPHO, EURC, cbETH (in order of deficit)
+
+4. Adopt Minimum Reserve Targets
+
+   - Reserve auctions remain limited until each asset’s reserves reach or exceed
+     Anthias’ recommended minimum level.
+
+5. Adopt an Allocation Strategy for cbXRP and VIRTUAL
+
+   - These two assets are of high interest and with a significant portion of
+     shortfall being centered between these two assets. As such, there may be a
+     preference to pay off VIRTUAL first due its historically high interest
+     rate.
+
+6. Transparently Communicate Progress
+   - The Foundation or designated contributors will report ongoing metrics
+     including:
+     - Remaining bad debt
+     - Reserves used
+     - Reserve accrual rate
+     - Progress toward minimum reserve targets
+
+### **Rationale**
+
+Bad debt weakens protocol solvency, user confidence, and long-term
+sustainability. The Anthias analysis demonstrates both:
+
+1. The scale of the problem — multiple markets are underwater, with an aggregate
+   shortfall of ~$5.25 M.
+2. A clear, conservative path to remediation — using existing reserves, limiting
+   auctions, and redirecting future accrual allows Moonwell to address the issue
+   without external capital or token dilution.
+
+PLimiting reserve auctions ensures the protocol does not drain capital too
+quickly while still allowing contributors flexibility to conduct small or
+periodic auctions when needed. Redirecting reserve accrual speeds up repayment
+using organic protocol revenue. Drawing from excess reserves in the most solvent
+markets allows immediate remediation of the largest deficits without sacrificing
+safety.
+
+In short: this plan protects the protocol, its users, and its long-term
+viability.
+
+### **Voting Options**
+
+- **Yes** — Adopt the Anthias bad-debt remediation plan: limit auctions,
+  redirect reserves, and use excess WETH/USDC/cbBTC to repay bad debt.
+- **No** — Reject the plan; continue current reserve operations.
+- **Abstain** — No preference.

proposals/mips/mip-x37/mip-x37.sol renamed to proposals/mips/mip-b52/mip-b52.sol

@@ -3,7 +3,7 @@
         "envpath": "",
         "governor": "MultichainGovernor",
         "id": 0,
-        "path": "mip-x37.sol/mipx37.json",
+        "path": "mip-b52.sol/mipb52.json",
         "proposalType": "HybridProposal"
     },
     {