August 2023
Summary
Sharing a recap of Gauntlet’s market risk management work with Aave in August 2023. See below for this past month’s work summary and a preview of what’s coming up in September.
Highlights
- Kicked off implementation of Lever B of the Synchronicity Price Adapter “Killswitch” Functionality for LST Emode in collaboration with BGD.
- Freeze CRV on Aave V2 Ethereum was executed.
- Freeze MAI and set MAI LTV→ 0 was executed.
- Published AIP to set MAI isolation mode debt ceiling to 0 on V3 Arbitrum, Optimism, Avalanche, and Polygon.
- Provided analysis and recommendations for deployment on Celo. Gauntlet will continue to provide analysis for additions of new assets and deployments for Aave.
| Category | Work Completed | Commmentary |
|---|---|---|
| Quantitative Research | Kicked off implementation of Lever B of the Synchronicity Price Adapter “Killswitch” Functionality for LST Emode in collaboration with BGD |
After months of research and development, the approval of Killswitch Functionality for LST Emode shows the community’s collaborative efforts to continuously innovate Aave in risk management. |
| Recommendations | Freeze CRV on Aave V2 Ethereum Freeze MAI and set MAI LTV→ 0 Set MAI isolation mode debt ceiling to 0 on V3 Arbitrum, Optimism, Avalanche, and Polygon rETH and LUSD borrow and supply cap increase on Ethereum and Arbitrum Interest rate recommendations for WETH and WMATIC on V2 and V3 Recommendation for WETH Uopt on V3 Ethereum |
Daily risk simulations and stress tests |
| Risk Modeling | Increase borrow cap for USDT and supply cap for MKR on V3 Ethereum Parameters for sDAI onboarding Parameter recommendations for V3 Deployment on Celo Analysis on automated IR mechanisms Analysis on wGHO on Aave V3 Recommendations for GHO stability module Increase borrow cap for LUSD and rETH on V3 Ethereum Parameters for enabling USDT as collateral on V3 Avalanche OP risk parameters on V3 Optimism Increase GHO Borrow Rate RPL, wstETH, LUSD, LINK, cbETH cap changes AAVE, METIS, DPI cap changes Recommendations on WSTETH and STMATIC cap changes MKR, RPL, UNI and cbETH cap changes |
Firefighting during unique market stress events. Risk modeling to provide insight into the risk/reward tradeoffs of Aave initiatives |
| Risk Monitoring and Alerting | Aligned on CRV Deprecation bi-weekly LT reduction plan and posted LT reduction recommendations on 8/21, 9/5, 9/13. Blameless Post Mortem: Curve Continuous Aave market updates in Telegram Channel, open to the public, for alerts from Gauntlet’s monitoring platform |
Gauntlet’s risk monitoring platform alerts the community of risk updates |
| Feature Upgrades | Added a new feature displaying interest rate curves on the recommendations page of the Gauntlet Aave dashboard, showing the expected impact of the recommendations. Note: these will only appear when a recommendation is live. Example on V3 Ethereum here. Added filters to all charts on the Gauntlet Aave dashboard, enabling users to select one or multiple assets to be represented in a clean, focused view. |
Gauntlet continuously upgrades its product offering |
Upcoming Selected Work
- Implementation of Lever B of the Synchronicity Price Adapter “Killswitch” Functionality for LST Emode
- Continuous analysis and recommendations for the CRV V2 Ethereum Deprecation Plan
- Provide risk analysis on Aave’s launches across chains
- Continuously monitor and increase supply caps if recommended via the Risk Steward process
- Continue support of community initiatives and market alerts
We are happy to answer any questions or hear any feedback - feel free to comment below.