Summary
LlamaRisk supports the proposed change and collateral risk parameters for AUSD. Based on the growth in the asset’s liquidity and continued stability, enabling the asset as collateral is well justified. In addition, current supply and borrow caps are rational. This change, together with the ongoing supply incentives, could further boost the utility of this asset on Aave’s Avalanche market therefore, the caps could further be revised employing Chaos Labs Risk Stewards.
There is currently around 7.5M AUSD to be sold for USDC within a 6% price impact. The liquidity mainly resides in 3 Joe V2.1 pools where AUSD is paired with USDC, USDT, and deUSD for a total TVL of ~$20M. As indicated by Chaos Labs, the asset’s liquidity has been stable at these levels for the past months.
Source: DefiLlama, February 28th, 2025
It is notable that Agora has not yet implemented a bug bounty program, though they have indicated it would be live in Q1 2025. We believe that this is a crucial risk mitigation mechanism that is imperative for every protocol. We look forward to Agora adhering to the best practices and keeping the protocol safety bar higher through the timely implementation of this program.
Disclaimer
This review was independently prepared by LlamaRisk, a community-led non-profit decentralized organization funded in part by the Aave DAO. LlamaRisk is not directly affiliated with the protocol(s) reviewed in this assessment and did not receive any compensation from the protocol(s) or their affiliated entities for this work.
The information provided should not be construed as legal, financial, tax, or professional advice.