LBS Blockchain Society Delegate Platform

Key Info

Introduction

The LBS Blockchain Society is a student and professional society at the London Business School set up in 2021 to empower the next generation of LBS business leaders to pursue the fast-growing opportunities in Web3. We focus on:

  • Education: Educating our peers on blockchain technology and new protocols in development in the ecosystem
  • Career Opportunities: Helping students place into roles in Web3 and network within the wider Web3 community
  • Entrepreneurship: Leveraging the entrepreneurial talent at LBS to help originate capital and bring ventures to market
  • Governance: Providing hands on learning experiences, by participating as delegates in leading DAOs and incubating our own experiments in on-chain governance

The LBS Blockchain Society is the fastest growing and most active society in the LBS community despite being the youngest, having gained over 700+ LBS Telegram members in the last 8 months and organising numerous events over the past year since our inception. This included hosting our first inaugural Blockchain Conference, where we hosted 250+ students across 8 events with 20 speakers and panelists. We are in the process of planning a second conference for January 2023.

Delegate Statement (why you should delegate to us)

LBS is home to the global business leaders of tomorrow. Consistently ranked among the top 5 business schools globally, LBS students come from and place amongst the top firms around the world. LBS students are experts in diverse subject matters, ranging from financial markets, to organisational theory, to data science. Given the diversity of cultural and professional backgrounds amongst the student cohort, LBS students are extremely entrepreneurial by nature. London Business School entrepreneurs have raised $4B of funding in 2021, while our alumni have founded over 560 companies so far, including unicorns such as HelloFresh, Feedzai, Wayflyer, Lonely Planet, and many more.

We have been delegates to MakerDAO since July 2022 through the a16z Token Delegate Programme, and have acquired invaluable expertise that will assist with our decision-making for Aave. We always commit to voting independently and impartially, and to open source our rationale through frequent updates to this thread, which will act to anchor our thinking and make ourselves accountable to the wider Aave community.

Given our co-location with Aave in London and the potential for partnerships beyond the governance programme, we see a natural synergy here for the society to be further involved with the activities of the protocol. As stated above, one of our objectives is to act as a facilitator in connecting the talent in our community to industry. We do so by organising large-scale events, workshops, networking sessions and more, as well as by directly helping to place students into roles in industry. Given the growing need for talent in Web3, we see significant scope for synergies between the organisational needs of Aave and the funnel of talent which our society can provide.

As delegates, we commit to dedicating our time and resources to help accelerate Aave’s development and growth. We will leverage our global network, business knowledge, and entrepreneurial mindset, to drive value for Aave token holders, and in doing so, seek to have a profound impact on the way the world does business within Web3.

Conflicts of Interest

The LBS Blockchain Society currently does not have any material conflicts of interest. As a society we do not hold any other cryptocurrencies nor do we currently take in membership fees. We agree to keep the Aave society updated should any conflicts of interest arise.

Waiver of Liability

By delegating to LBS Blockchain, you acknowledge and agree that LBS Blockchain will participate on a best efforts basis and will not be liable for any form of damages related to participation in the Aave Protocol or this DAO.

7 Likes

Chaos Labs - Risk & Simulation Platform

Vote Result: YES

Rationale

The commercial model proposed by Chaos Labs is attractive, with the 6-month provision of free services offering an opportunity to test them out with little to no risk taken by the DAO. Increased competition is healthy, and it is important to test out the arguments made by detractors around the lack of rigour in Chaos’ model and the potential detriment to having two platforms providing risk parameter recommendations. The positive testimonies by BenQi and Flipside Governance indicate that Chaos Labs is a worthy platform and it would be remiss not to give them an opportunity to prove their worth.

It will be important to assess the impact of Chaos Labs on governance speed and scalability over the 6 month period since that is the area that is most liable to be negatively impacted.

In agreement with Raphael from Flipside, we propose to trial Chaos out for 4.5-5 months and then come together as a community to decide on further steps.

1 Like

BGD. Aave v3 Ethereum. New deployment vs Aave v2 Upgrade

Vote Result: YES

Rationale

The technical simplicity and cost outweigh the UX benefits in this case. Forking to a new version is also common practice in crypto and has already been successfully implemented on Avalanche and Polgyon.

2 Likes

[ARC] Risk Parameter Updates for Aave V2

Vote Result: YES

Rationale

We are voting in line with the community’s decision and are in favour of more optimised protocol capital efficiency and risks. The values of these adjustments seem a conservative step in seeking these protocol parameters, and are in line with the ‘Moderate’ Risk Level choice by the community. The small modifications to the current parameters do not seem to add significant risk, especially since the recommendations have been derived from simulations based on updated market data.

2 Likes

Use AAVE Ecosystem Reserve to Vote YES on Proposal to Adjust Level 2 Governance Requirements

Vote Result: YES

Rationale

The analysis done by BGD Labs to lower the voting thresholds for Level 2 proposals is comprehensive and well thought out. The data from previous proposals indicates that Level 2 proposals have too high a bar in terms of support needed for votes to pass, especially given the number of Aave tokens locked up and not eligible for voting. Our vote of YES is well aligned with the rest of the community, and we agree with the need to direct the Aave Ecosystem Reserve to vote YES on this proposal, given the high bar for Level 2 proposals to pass.

2 Likes

Adjust Aave Governance Level 2 Requirements

Vote Result: YES

Rationale

In line with our rationale for the ‘Use AAVE Ecosystem Reserve to Vote YES on Proposal to Adjust Level 2 Governance Requirements’ proposal (noted above), we voted YES for this proposal as well.

1 Like

Risk Parameter Updates for Aave V2 ETH (2022-10-06)

Vote Result: YES

Rationale

In line with our rationale for the ‘[ARC] Risk Parameter Updates for Aave V2’ proposal (noted above), we voted YES for this proposal as well.

2 Likes

Whitelist Balancer’s Liquidity Mining Claim

Vote Result: YES

Rationale

The initial contract did not consider the need for calling the claimRewards function to claim stkAAVE, with this proposal acting as a fix. Because this is a technical solution to enable Balancer to take control of legitimately accrued rewards, we are voting in favour of this proposal.

Risk Parameter Updates for Aave V2 ETH

Vote Result : YES

Rationale

Given the price manipulation attacks on other protocols (like Mango Market), there is a need to act prudently in the current environment, and the proposal from Gauntlet to change risk parameters for BAL, BAT, DPI, MANA, REN, and ZRX is necessary. It is also important to act quickly, which is why we have decided to vote to adjust the risk parameters on Aave v2 ETH and v2 and v3 Polygon after discussing the risk model in depth with the Gauntlet team. The assets do not currently have high liquidity and were added to Aave when conditions were different in the bull market. The loss for liquidated users due to the parameter changes is minuscule compared to the value protected.

We would also recommend subsequently revisiting the parameter changes for DPI since it can be redeemed for its constituent assets, but are in favour of the two proposals as they are now due to the necessity to act quickly.

1 Like

Risk Parameter Updates for Aave Polygon Markets

Vote Result : YES

Rationale

Given the price manipulation attacks on other protocols (like Mango Market), there is a need to act prudently in the current environment, and the proposal from Gauntlet to change risk parameters for BAL, BAT, DPI, MANA, REN, and ZRX is necessary. It is also important to act quickly, which is why we have decided to vote to adjust the risk parameters on Aave v2 ETH and v2 and v3 Polygon after discussing the risk model in depth with the Gauntlet team. The assets do not currently have high liquidity and were added to Aave when conditions were different in the bull market. The loss for liquidated users due to the parameter changes is minuscule compared to the value protected.

We would also recommend subsequently revisiting the parameter changes for DPI since it can be redeemed for its constituent assets, but are in favour of the two proposals as they are now due to the necessity to act quickly.

1 Like

Announcing our new Envoy Proposal Alerter tool!

The problem

As delegates sitting across multiple protocols it can be difficult to keep track of all the new proposals and executive votes coming onto the platform.

Solution

We have developed an internal tool called Envoy that we use to keep track of new and expiring proposals. It is a simple Node.js application that regularly scrapes the governance page and forwards alerts to a frontend Telegram bot. We have also integrated Hal to deliver Snapshot alerts, although it doesn’t (yet) send alerts for poll deadlines.

We are sharing this tool with the Aave community in case other delegate teams run into the same problem. You can now join the Telegram channel here to start receiving alerts:

Telegram: Join Group Chat

Feedback

Any feedback or suggestions on the tool would, of course, be greatly welcome.

Aave v3 Polygon wMATIC Interest Rate Update

Vote Result : YES

Rationale

Increasing utilisation of the wMATIC tokens will increase protocol’s revenue, and this proposal only intends to modify parameters of a listed token. The strategy itself is fairly straightforward: lowering rates against staking yield to incentivise borrowing from Aave v3 Polygon’s liquidity pool. Therefore, given the need to adapt parameters to deal with market conditions and the potential revenue increase from changing this parameter, we have decided to vote YES for this proposal.

Risk Parameter Updates for Aave V3 Avalanche

Vote Result: YES

Rationale

The proposal by Gauntlet is in line with continuously adjusting parameters based on prevailing market conditions. Since the impact on VaR is modelled to be minuscule, and there is the potential of a material increase in borrow usage, the parameter changes are sensible. Moreover, the phased approach taken by Gauntlet to gather initial data and re-calibrate the parameters is ideal, while changing the parameters of only the most liquid assets in light of the recent price manipulation attacks across DeFi is prudent.

Taking all of the above into account, we have decided to vote YES for this proposal.

1 Like

Add Login With Unstoppable as an Option to the Wallet Connect Dialog of the Aave App

Vote Result: NO

Rationale

The benefits for integrating Unstoppable Domains and Login with Unstoppable are not clear, and the risks are not outlined at all. There is no post on the governance forum that provides any detail. Additionally, it is likely that the target audience for Unstoppable overlaps with that of Aave and they are already exposed to Aave. Therefore, we are voting NO for this proposal. However, we will definitely reconsider our decision if there is more information provided.

Add TRYB to Aave V3 on Avalanche Network, Isolation Mode

Vote Result: NO

Rationale

TRYB is a low market cap, low liquidity stablecoin with an extremely low amount on-chain, as reflected in FranklinDAO’s rationale. Volatility for the stablecoin is high, and as they explain above, revenue for Aave is expected to be low. The market cap is only $12 million, which is too low for a flagship protocol like Aave. Moreso, the Independent Auditors’ reports for Proof of Reserve are infrequent - Proof of Reserves should not happen only twice a year, although there is precedent for this in the crypto space with the characteristics of USDT. Lastly, listing with a 0% LTV but 70% LT does not make sense if TRYB is only being listed as a Borrow asset.

In summary, given the issues above, we have decided to vote NO for this proposal.

1 Like

Deploy Aave V3 to zkSync 2.0 Testnet

Vote Result: YES

Rationale

zkSync is one of the leading contenders to deploy a (Type 4) zkEVM, alongside Scroll and others, on top of Ethereum. zkEVMs inherit the security of Ethereum while enabling mass scalability and composability. It is also relatively easy to deploy existing EVM code to them due to their EVM-compatibility, and data availability will further enable high throughput and low fees by migrating data off-chain.

For a chain which has high potential to draw users from across DeFi and other L2s where Aave is already deployed, it would make strategic sense for Aave to deploy early to testnet and iterate with the Matter Labs team. Aave is a flagship DeFi protocol and deploying to zkSync could help reduce fees, increase throughput, while maintaining the same level of security.

Therefore, we have decided to vote YES for this proposal to deploy Aave V3 to the zkSync 2.0 Testnet. However, we don’t think Aave V3 is ready for mainnet launch at this stage given the early launch and incomplete feature set - for mainnet we would prefer a “watch and wait” approach.

Great and brilliant that can help this community grow

2 Likes

Security and Agility of Aave Smart Contracts via Continuous Formal Verification

Vote Result: YES

Rationale

We will support the continuation of Certora’s engagement with Aave since we acknowledge the value they have added to Aave’s community so far, their effort and results for seeking the community’s engagement, and their willingness to continue doing so in the long term. It is important to acknowledge that it is difficult to assess the relative success or failure of a product like Certora, which is judged more on the bugs that are missed as compared to the bugs that have been identified. However, Certora’s track record to date gives us confidence in their abilities and product, along with the direct engagement they have had with LBS Blockchain Society over the last week. Moreso, compared with the fees charged for the past engagement, the current proposed fees do not seem to be extortionately high.

[ARC] Staked ATokens, A New Aave Primitive Exploring Vote-Escrow Economies

Vote Result: YES

Rationale

We have voted YES since, overall, the proposal shows how this integration can offer enhanced rewards and increased capital efficiency while maintaining reasonably low risk. Among the various ways to experiment with different VE protocol integrations, this seems the safest to begin with.

It remains to be considered what the preferred option for new collateral type listings is: either bringing this to the regular V3 market using the relevant security measures such as isolation mode or launching a new V3 AMM Market. A new V3 AMM Market could be the safest option.

1 Like

[ARC] - ERC4626 Strategies as Productive Collateral

Vote Result: YES

Rationale

Onboarding this type of collateral in Aave will allow for an increased number of use cases and yield strategies that can incentivize borrowing demand.

We will support this proposal since we believe it has the potential to foster the ecosystem’s growth; however, we would like to highlight the risks it bears (as shown in Gauntlet’s analysis) and stress the need for a deeper thought at the time of defining both collateral types and parameters.

We will have to very carefully judge the risk of the LP tokens that are allowed as collateral since there could be a situation of over-leverage and over-hypothecated risk, which could be negative for Aave since they would have to absorb the bad debt. Gauntlet also highlighted that it is possible that liquidators do not have incentives to buy the assets at depressed prices, leading to Aave having to absorb that bad debt, highlighting the need for prudence and conservatism in the assets onboarded as collateral.