Summary
LlamaRisk supports the proposal to mint and deploy 10 million GHO into the Aave Lido instance, viewing it as a prudent step to bolster GHO after its initial onboarding to the Lido market. However, it is important to note that upon implementation of the Onboarding GHO on Lido instance proposal, approximately 7.3 million GHO from the Treasury would be supplied to the GHO reserve. This would partially utilize the proposed 11 million supply cap, meaning that the immediate deployment of an additional 10 million GHO would not be feasible. We therefore recommend minting and deploying this allocation in stages, with Risk Stewards gradually raising the supply caps to accommodate these GHO injections.
Additionally, we have addressed the risk considerations for this GHO deployment in a note accompanying the initial Onboarding GHO on Lido proposal and found no risk-related issues this deployment. We therefore expect that the proposed additional GHO will be deployed optimally, as directed by the Risk Stewards, without affecting the risk profile of either GHO or Aave’s Lido market. As outlined in our note, and in agreement with @karpatkey_TokenLogic, we also believe that adding yield-bearing stablecoins to the Lido would enhance the utility of stablecoin borrowing in this market.
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.