Doing a gut and addition to a 1950s ranch house. Currently there is no insulation in the exterior walls and there is asphalt-impregnated fiberboard sheathing. Pulling the existing veneer off and replacing it with ZIP is out of the question as it is cost prohibitive.

So what are my insulation options?

1) I’ve considered closed-cell spray foam, however I am concerned over the long term the fiberboard will degrade over time because it will not be able to breathe.
2) I’m leaning toward dense-pack cellulose. This will allow the fiberboard to breath and give me some what of an air barrier. Plus it’s cheaper.