Gauntlet Monthly Updates

[Pauljlei]

January 2023

Summary

Sharing a recap of Gauntlet’s market risk management work with Aave in January 2023. See below for this past month’s work summary and a preview of what’s coming up in February.

Category	Work Completed	Commmentary
Quantitative Research	Interest rate curve framework for the Aave protocol Published Borrow and Supply cap methodology for Aave V3	Over the last several months, Gauntlet has conducted quantitative research on optimizing interest rate curves and setting borrow/supply caps
Recommendations	2 sets of Aave V2 ETH Recommendations Avalanche and Optimism Recommendations Optimism Cap Additions	Daily risk simulations and stress tests
Risk Modeling	Risk Analyses on Shanghai Upgrade cbETH Listing Analysis on V3 ETH rETH Listing Analysis on V3 ETH Analysis on Llama CRV Interest Rate Upgrades wstETH Listing Analysis on V3 OP jEUR Incident Analysis	Risk modeling to provide insight into the risk/reward tradeoffs of Aave initiatives
Risk Monitoring and Alerting	GUSD Utilization Whale Liquidation Position Near Liquidation	Gauntlet’s risk monitoring platform alerts the community of risk updates
Other	IR Curve Corrections on wETH IR Curves Community Bug Bounty	Community and contributor support

Highlights

• Aligned with risk-related service providers and stakeholders on key priorities for the quarter. Setup recurring syncs and shared processes with Chaos and Llama to collaborate more closely on risk-related initiatives, including recommendations on asset listings
• After conducting quantitative research on interest rate curves, provide framework to the Aave community for optimizing interest rate curves. Published recommendations that were approved by the community on-chain
• Updated incident response process - completed setup for internal alerts, escalation, investigation, and monitoring processes
• After conducting quantitative research, published our borrow and supply cap methodology for Aave V3
• Conducted market risk analysis in preparation for Shanghai update

Upcoming Selected Work

• Launching updated Risk Simulation Dashboard
• Publishing Gauntlet holistic risk parameter methodology - guiding principles, overall methodology, etc
• Aligning with stakeholders on communication channels for sensitive market alerts
• Launching v3 Polygon integration into our risk simulation platform

We are happy to answer any questions or hear any feedback - please feel free to comment below.

[Pauljlei]

February 2023

Summary

Sharing a recap of Gauntlet’s market risk management work with Aave in February 2023. See below for this past month’s work summary and a preview of what’s coming up in March.

Category	Work Completed	Commmentary
Quantitative Research	Gauntlet risk dashboard launch for V3 ETH, V3 Polygon, and V3 Arbitrum Interest Rate Curve research for all Aave V3 Markets	After months of simulation battle-testing and integration, we have launched risk dashboards for V3 ETH, V3 Polygon, and V3 Arbitrum Over the last several months, Gauntlet has conducted quantitative research on optimizing interest rate curves and setting borrow/supply caps
Recommendations	2 sets of Aave V2 ETH Recommendations Avalanche and Optimism borrow cap recommendations, following Snapshot Vote 2 sets of Aave V3 OP and V3 Avalanche Recommendations Polygon V3 Recommendations	Daily risk simulations and stress tests
Risk Modeling	Update on Shanghai Upgrade Market Risk implications to Aave CRV Interest Rate Curve Analysis stMatic Supply Cap Update wMatic Supply Cap Analysis cbETH Supply Cap Analysis Detailed Analysis on sfrxETH Asset Listing WAVAX Interest Rate Curve Analysis CRV Asset Listing on V3 ETH Analysis Recommendation on BUSD MaticX V3 Polygon Risk Analysis LUSD Asset Listing on V3 ETH Analysis USDT Listing on V3 ETH Analysis MAI Borrow Cap Analysis on V3 Polygon	Risk modeling to provide insight into the risk/reward tradeoffs of Aave initiatives
Risk Monitoring and Alerting	Supply concentration alerts Whale Supply Position Position Near Liquidation Position Liquidation WETH Borrow Position BAL Supply Cap Usage Borrow and Supply Cap Usage on V3 Polygon and V3 Arbitrum	Gauntlet’s risk monitoring platform alerts the community of risk updates

Highlights

• After months of simulation battle-testing and integration, we have launched risk dashboards for V3 ETH, V3 Polygon, and V3 Arbitrum
• After conducting quantitative research on interest rate curves, extended methodology to cover Aave V3 markets
• After conducting quantitative research, the community has aligned on a risk preference for borrow and supply caps for V3 markets.
• Conducted continued market risk analysis in preparation for Shanghai update

Upcoming Selected Work

• V2 of Risk Simulation Dashboard roll-out
• Aave V3 Migration Analysis
• Continued support of community initiatives and market alerts

We are happy to answer any questions or hear any feedback - feel free to comment below.

[Kene_StableNode]

Great Job!

Gauntlet has been providing immense value to Aave, and we are excited to see how this value scales to other Aave Initiatives, such as GHO and its accompanying operational aspects.

[thewatcher]

@Pauljlei hello.

i am not sure we need updates on the forum // why do we keep on posting these?

it leads to bloat, which my mother suffered from.

@Kene_StableNode is your comment productive, or a mere appetite for desirability?

this sort of “update” was made famous by a team desperate for attention.

why purge our home?

we know you’re whereabouts // it is an issue when we don’t.

to my beloved Aave DAO. speak with your actions, not your words.

carefully, watching.