Chaos Labs - Monthly Community Update

[ChaosLabs]

June 2023

Overview

This update highlights the past month’s activities and proposals and shares our planned work.

Highlights

• Following a community discussion around the CRV market on Aave V2, Chaos proposed an alternative strategy to freezing the market. Following the community discussion, we put forward a series of proactive proposals to reduce exposure on v2 and further encourage users to migrate positions to v3:

  • [ARFC] Chaos Labs V2 to V3 Migration Next Steps
  • [ARFC] - Chaos Labs Risk Parameter Updates - CRV Aave V2 Ethereum - 2023.06.15
  • [ARFC] - Chaos Labs Risk Parameter Updates - CRV Aave V2 Ethereum - 2023.06.15

• Over the weekend of June 10th, the markets experienced significant turbulence following the SEC filings against Binance and Coinbase. The Chaos team was closely monitoring the markets to prepare risk-mitigating strategies for various developments. During this time, the protocol encountered orderly liquidations and did not necessitate any immediate or additional actions.

• We are constantly iterating and improving the Chaos Risk Monitoring Platform and have added support for Polygon and Avalanche V2 data and analytics. In addition, we have added support for Metis on the Chaos Labs Parameter Recommendation Platform. The platform now supports all Aave V3 deployments.

• We published the following proposals for risk parameter updates and new asset listings as part of the efforts for V2 → V3 migration.

  • [ARFC] Add USDP to Aave V3 Ethereum
  • [ARFC] Add GUSD to Aave V3 Ethereum
  • [ARFC] - Risk Stewards - Increase Borrow Cap WETH Arbitrum
  • [ARFC] Chaos Labs V2 to V3 Migration Next Steps
  • [ARFC] - Chaos Labs Risk Parameter Updates - CRV Aave V2 Ethereum - 2023.06.15
  • [ARFC] Chaos Labs Risk Stewards - Increase Supply Caps wstETH Arbitrum and Ethereum
  • [ARFC] Chaos Labs - Incremental Reserve Factor Updates - Aave V2 Ethereum
  • [ARFC] Chaos Labs Risk Parameter Update - CRV Aave V3 Polygon - 2023.06.20
  • [ARFC] Chaos Labs Risk Parameter Updates - FEI on Aave V2 Ethereum - 2023.6.22
  • [ARFC] Chaos Labs Risk Stewards - Increase Supply Caps on V3 Metis
  • [ARFC] Chaos Labs Risk Parameter Updates - Aave V2 Ethereum - 2023.6.23
  • [ARFC] Chaos Labs Risk Stewards - Increase Caps rETH and wstETH on V3 Arbitrum

• Provided analysis and supported the following proposals:

  • [ARFC] Add rETH Aave v3 Optimism
  • [ARFC] Aave V3 Deployment on BNB Chain
  • [TEMP CHECK] Integrating MakerDAO’s DSR into Aave V3 Ethereum Pool
  • ARFC: Supply Cap Updates for Polygon Aave V3, Arbitrum Aave V3 on 2023-06-17
  • [ARFC] Add native USDC to the Arbitrum V3 pool
  • [ARFC] Emode Risk Parameters Aave ETH V3 Pool Update
  • [ARFC] Use Risk Stewards to Increase wstETH Supply Cap
  • [ARFC] USDT Risk Parameters Update Aave V3 ETH Pool
  • [ARC] Add SUSHI to AaveV3 on Mainnet
  • [ARFC] wMATIC Supply & Borrow Cap Increase Polygon v3
  • [ARFC] Add FRAX Arbitrum Aave v3
  • [ARFC] Increase Supply Caps for LSTs on AAVE V3

What’s Next

In the coming month, the Chaos team will focus on the following few areas:

• Continuation of the community plan for V2 → V3 migration as described here
• Additional V2 risk parameter updates to gradually reduce capital efficiency across V2 collateral assets.
• Continuous optimization of risk parameters on V3 deployments.
• Analysis and parameter recommendations for new assets and markets.