[MRC-48] nobleUSDC Listing


The objective of this proposal is to list USDC minted on the Noble blockchain (nobleUSDC) and IBC’d onto Osmosis as a collateral asset on the Osmosis outpost of the Red Bank.


With Mars credit accounts’ new margin trading capabilities, we expect the usage of stablecoins within the Red Bank to increase. The reason for this is that they’re the fundamental asset that allows for margin trading on credit accounts. Specifically, users looking to margin long a certain asset will borrow stablecoins to buy that asset and users wanting to short a certain asset will borrow the asset to sell it for stablecoins. As such, we believe the listing of nobleUSDC will increase organic usage of the Red Bank as the popularity of margin trading increases.


In the sections below we’ll explore the risks associated with listing nobleUSDC and the proposed risk parameters for the listing.

Technical Risk

Metric Requirements Comments
Time Since Launch Minimum USDC minting/redeeming on the Noble blockchain launched on September 12, 2023.
Custom Public Audit Minimum Noble went through 3 audits, although only one is public so far.
Recent Audit Ideal The linked public audit was conducted within the last 12 months.
No Critical Vulnerabilities Ideal No critical vulnerabilities have been exploited.
Bug Bounty Program Not met Noble has no active bug bounty.

Centralization Risk

Noble implements a tokenfactory module pattern to enable the minting of generic assets in Cosmos. Further, tokenfactory modules are under the exclusive purview of the asset issuers and are separate and distinct from governance of the Noble chain. Additionally, each tokenfactory module is distinct from one another as they each house unique access controls with ownership over the minting and burning of a specific asset. As such, the USDC tokenfactory module is managed by Circle, as the issuers of USDC. Key authorities and permissions for this module include:

  • Owner: The Owner role has the authority to reassign all roles and is held by Circle.
  • Minter: The Owner has the authority to add and remove Minters, which have the authority to mint and burn tokens on the Noble chain.
  • Blacklist: The asset issuer has the ability to blacklist addresses. A blacklisted address will be unable to transfer tokens outside of Noble via IBC, or to approve, mint or burn tokens.

Given the above, it’s clear that nobleUSDC (as native USDC on Ethereum) is a centralized asset where Circle will have significant control over how the asset is used on the Noble blockchain, including blacklisting capabilities.

This centralization risk is very real and can materialize in a number of ways. If the Circle multisig were to be compromised, be it via regulatory pressures, a hack/exploit or just multisig member misbehavior, the asset could suffer significant consequences that could translate into drastic repricings that may lead to protocol insolvency.

This is a known risk when listing these types of assets. The trade-off being made here is more centralization for more usability. Given USDC’s popularity, unfortunately we believe this is a trade-off that’s worth making at this point.

Additionally, it’s worth noting that the Noble blockchain itself follows a PoA design with a trusted validator set. Currently, the validator set is composed of 20 entities with equal voting power each. Given that the tokens staked by these validators are symbolic and have no value, the economic security of the chain won’t be derived from the traditional PoS slashing deterrent, but rather from the validators’ reputation and the forfeited future earnings or offchain legal liabilities that any misbehavior could entail.

Oracle Risk

We propose to use the Pyth USDC/USD feed to price nobleUSDC.

Note that while nobleUSDC is the official version of USDC on Cosmos, as it’s directly minted by Circle and its authorized parties, the price of nobleUSDC could potentially deviate from the overall price of USDC in the market (which includes CEXs and other onchain markets like Ethereum). If this were to happen, the Pyth feed probably wouldn’t reflect this divergence, which could translate into issues for Mars.

Collateral Backing Risk

Every USDC (and nobleUSDC) token issued is backed by a mix of assets which is under the discretion of Circle. These assets are currently US Treasury Bills and cash held at regulated financial institutions. Each USDC should be fully backed by these assets. However, this is not an absolute certainty. As some of these assets are exposed to counterparty risk, their quality and value as collateral could fluctuate. As such, if this risk were to materialize, USDC could become undercollateralized (or even if it doesn’t, trust in the asset could suffer), leading to high, unexpected levels of volatility which could expose Mars to bad debt.

Risk Parameters Suggestion

  • Max. LTV: 79.5%
  • Liquidation LTV: 80%
  • Deposit Cap: 1,000,000 nobleUSDC
  • Interest Rate Parameters:
    • Optimal Utilization: 80%
    • Base IR: 0%
    • Slope 1: 12.5%
    • Slope 2: 200%
  • Liquidation Parameters:
    • Starting LB: 0
    • Slope: 1
    • Max. LB: 0.2
    • Min. LB: 0.05
    • Target Health Factor: 1.05
    • Protocol Liquidation Fee: 0.25
  • Reserve Factor: 10%
  • Usable as collateral? Yes
  • Available to borrow? Yes


This is a signaling proposal, not an executable proposal.

The Mars smart contracts on the Osmosis chain are currently controlled by the Builder Multisig address. If this proposal passes, the builders will utilize their multisig to make the necessary parameter changes.


Copyright and related rights waived via CC0.


This proposal is being made by Delphi Labs Ltd., a British Virgin Islands limited company. Delphi Labs engages in incubation, investment, research and development relevant to multiple ecosystems and protocols, including the Mars Protocol. Delphi Labs and certain of its service providers and equity holders own MARS tokens and have financial interests related to this proposal. Additionally, Delphi Labs is one of several entities associated with one another under the “Delphi Digital” brand. Delphi Digital’s associated entities and/or equityholders or service providers of such entities may hold MARS and may have financial interests related to this proposal. All such entities, service providers, equity holders and other related persons may also have financial interests in complementary or competing projects or ecosystems, entities or tokens, including Osmosis/OSMO. These statements are intended to disclose relevant facts and to help identify potential conflicts of interest, and should not be misconstrued as a complete description of all relevant interests or conflicts of interests; nor should they be construed as a recommendation to purchase or acquire any token or security.

This proposal is also subject to and qualified by the Mars Disclaimers/Disclosures. Delphi Labs may lack access to all relevant facts or may have failed to give appropriate weighting to available facts. Delphi Labs is not making any representation, warranty or guarantee regarding the accuracy or completeness of the statements herein, and Delphi Labs shall have no liability in the event of losses or damages ensuing from approval or rejection or other handling of the proposal. Each user and voter should undertake their own research and make their own independent interpretation and analysis of all relevant facts and issues to arrive at their own personal determinations of how to vote on the proposal.