Chaos Labs - Monthly Community Update

Governance
20

August 2024

This update highlights Chaos Labs’ activities and proposals in August.

Highlights

August 6 Market Events

Following a rapid and severe downturn in markets, we provided an in-depth analysis of all Aave deployments to provide the community with information on the protocol’s health. We found that the protocol had accrued no bad debt.

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Increase WETH Optimal Ratio to 90%

We responded to a post by ACI proposing to increase the WETH Optimal Ratio to 90% on the deployments where it was previously 80%. We analyzed all of these markets to ensure that UOptimal could be safely increased, allowing enough of a buffer to process liquidations.

Deploy an Ethena Aave V3 Instance

We provided recommendations for a new Aave instance that will contain sUSDe and USDe as its primary collateral assets. This included providing recommendations for FRAX and pyUSD, as well as assessing USDe and sUSDe’s current utilization.

What’s Next

In the coming months, the Chaos team will continue its focus on the following areas:

  • GHO: ongoing recommendations, including updating parameters for GHO on Arbitrum.
  • Continuation of the V2 risk parameter updates to gradually reduce capital efficiency across V2 collateral assets.
  • Continuous optimization of risk parameters on all V3 deployments.
  • Further updates on the development of Chaos Labs Risk Oracles.
  • Analysis and parameter recommendations for new assets and markets.
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