Delegate Address: michiganblockchain.eth
0x13BDaE8c5F0fC40231F0E6A4ad70196F59138548
Twitter: https://twitter.com/UMichBlockchain
Email: defi-delegates@umich.edu
External Website: https://www.michiganblockchain.org/
Background:
Founded in 2018, Blockchain at Michigan’s mission is to prepare students to excel in the blockchain space. We accomplish this by providing opportunities in education, consulting, and governance.
Education: Each semester, new members are required to attend weekly education sessions that culminate in a final project showcase. Our curriculum not only teaches valuable developer skills, but also the necessary business context to understand where to apply blockchain solutions.
Consulting: Our members gain professional experience by providing developer and business consulting services to blockchain startups and Fortune 500 companies’ emerging crypto divisions. Recent clients include Solana, Paypal, TRM Labs, etc, some of whom have partnered with us over multiple semesters.
Governance: We believe participating in governance is one of the most impactful ways to shape the future of DeFi. As delegates for Uniswap, Aave, and Compound, we actively work with the stakeholders in each protocol’s ecosystem.
Delegate Statement:
Blockchain at Michigan is committed to working with other delegates, service providers, and the Aave team to ensure the sustainable growth of the Aave protocol. We dedicate our time and resources to:
- Asset Risk Management
- Improving the governance process
- Expansion of Aave onto new L1 and L2s
1 Like
[ARFC] Polygon Supply Cap Update 07.07.2023
Our Vote: Abstain
Rationale:
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We have indicated our more conservative preference for the 50% LST supply cap at the Community Preference for Supply Cap Limits for LSTs vote.
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Since 75% is the maximum supply cap, the actual supply cap of each asset should be assessed individually, but there’s very little analysis in this forum discussion. In the unlikely event of a liquidity crunch or secondary market price deviation, what would be the potential impact on Aave?
Our Vote: Yae, Aggressive
Rationale:
Reducing risk by lowering the LTV and LT of CRV is necessary given the lack of market liquidity and holdings concentration by one account. We prefer the aggressive option because:
- Only $116 will be liquidated.
- Fewer proposals will be needed in the future, saving time for delegates.
Our vote: Nae
Rationale:
This forum post proposes an OTC transaction where the DAO allocate 2M USDT from the treasury to obtain aCRV from the Curve co-founder 0x7a16ff8270133f063aab6c9977183d9e72835428.
What does this proposal tries to achieve:
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improve GHO liquidity by locking the acquired 5M CRV tokens to gather Curve voting power and support a GHO-specific Gauge
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de-risk Michael’s position by paying off some of his debt.
We do not think this proposal is effective at achieving any of its goals.
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Risk:
i. Instead of de-risking, the proposal just transfers the risk from the safety module to the DAO treasury, even though the safety module is intended to absorb the risk of bad debt.
ii. 2M is small compared to the amount of debt that the user has, so his position would not be de-risked meaningfully.
iii. Aave treasury is and has been operating at a loss, we should not be acquiring more risky assets. The treasury is meant for wealth preservation, not speculations.
iv. Although the CRV would be acquired at a discount, any gains are unrealized and on paper only. We do not know the future market conditions should we try to sell the CRV.
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GHO liquidity
i. It is not clear that acquiring CRV is the most effective way to boost GHO liquidity. As TokenLogic pointed out, veCRV supply has been diluted substantially recently due ot OTC deals, and CRV inflation is scheduled to reduce by 15%.
ii. The proposal provided no analysis of how the OTC deal could impact GHO liquidity, and no comparison of how CRV compares of Balancer.
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DAO’s purpose:
i. It’s not good precedence for the DAO to engage in opportunistic speculations. we think the DAO should focus on growing the Aave protocol and preserving the treasury’s wealth.
ARFC wGHO Aave v3 Onboarding
Our vote: Yae
Rationale:
Gauntlet brought up a great point that attackers can manipulate the price of GHO using wGHO as collateral. This lead to the suggestions to have wGHO in isolation mode, and a low debt ceiling of 1M. We think these measures should mitigate risk while still allow the DAO to experiment with providing arbitrage opportunities for GHO.
[ARFC] OP Risk Parameters Update
Our Vote: Yae
Rationale: We do not see any red flags with allowing OP to be borrowed and removing Isolation Mode. As the Optimism L2 continues to mature, we welcome experimentation with greater capital efficiency, while abiding by the risk manager’s parameter recommendations.
Our Vote: Option 3: 0.9 (no change)
Our Rationale:
Liquidity:
- Gauntlet brought up very reasonable liquidity concerns about wETH. However, their analysis is based on the assumption of no debt repayment which is extreme.
- Even with 100% utilization, liquidators can get aWETH with a bonus and earning at really high return (while 100% utilization lasts).
v2 → v3 migration:
- The proposal would make v2 more attractive than v3, which hurts the migration.
Revenue
- lowering the change makes recursive borrowing less attractive on Aave, we don’t want that for one of Aave’s best revenue-generating assets.