[ARFC] Gauntlet <> Aave Renewal 2023

Hi @MatthewGraham - thank you for your thoughts. We appreciate the feedback and would also like to clarify some misperceptions.

Gauntlet’s risk monitoring platform is 24/7. There are many examples of Gauntlet working around the clock to protect Aave, including market events, USDC Non-Parity Event, and most recently the security incident.

We think you may be referring to Gauntlet not being available 24/7 to accommodate all of TokenLogic’s requests. We agree that we should have been faster with cap updates at the beginning of the year. We believe this has since improved, and the Risk Steward is being used much more frequently now. We commit to doing better here, and if the cap is indeed full, we of course commit to using the Risk Steward regardless of what day it is. We are happy to set up a recurring meeting with you to ensure we are prioritizing your requests commensurately along with the critical risk management work we do to ensure Aave is safe.

We’d note to the community that different service providers focus on different areas to serve the DAO. TokenLogic has focused on Growth among other things. We have disagreed with TokenLogic many times, including increasing caps for MaticX. The priorities of other service providers may not always line up with the priorities of our priorities, and we usually aim to prioritize workstreams related to Risk when it comes to speed. When it comes to requests, we may at times prioritize quality over speed in order to uncover potential hidden risks. As Risk Managers, our commitment is foremost to the DAO. We look to collaborate in a professional capacity with any service provider the DAO chooses. We are here to provide objective risk analysis, even when others disagree with us given differing objectives, and we are aligned by having skin in the game.

Everyone is certainly entitled to their opinion of the Dashboard. Usually community members request user studies, so if this is of interest, it would be great to discuss in more detail.

We are focusing on the highest impact services. Dashboards, from all the users studies we have performed, rank below other services including GHO Peg analysis, LST Killswitch, and DeFi tail-event research. That said, we have made significant improvements - please see our account explorer.

To be abundantly clear, Morpho was a one-time economic audit, similar to how smart contract auditors conduct audits across protocols. We do not currently serve Morpho.

Earlier this year we launched Gauntlet Applied Research. This team performs R&D often on an ad-hoc, short-term basis. While it may be perceived Morpho is competitive, we are very cognizant of the strategic implications this would have for Aave, and under no circumstances would GAR take on work with unacceptable conflicts of interest. While we don’t view any conflict of interest, we commit to 100% transparency and will let the DAO know if we ever do serve Morpho.

At a high level, the research and modeling work we do improves the value of our platform overall for all clients as we iterate on assumptions around factors like liquidity elasticity and liquidator behavior.

On pricing: to be clear, your guidance on a fixed $2M was a key input last year so that we can give the DAO predictability. While you are mentioning a budget of $1.6M now, less than a month ago you mentioned a combined Risk budget of $2.5M (implying $1.25M for Gauntlet).

We aim to have a very principled-based approach towards our pricing structure. TLDR; we are expanding scope without increasing our fee. This results in predictability for the DAO and Gauntlet.

We appreciate your comment around GHO payment and we always aim to be fully aligned with the DAO.

We are open to being flexible here @MatthewGraham @EzR3aL @0xkeyrock.eth. As such, we will increase our GHO portion to 50%. The rest will be taken in aUSDT (given the relatively lower amount of aUSDC reserves).

Summary

  • At the end of the day, if the community would like to continue Gauntlet’s full-suite risk management services with the DAO, we would be excited to have a proposal that makes sense for the DAO.
  • To clarify - our foremost commitment is to the DAO. We are open to working with any service provider the DAO chooses and commit to collaborating more without losing sight that our primary function is Risk Management.
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