[ARFC] Reserve Factor Updates - Polygon Aave v2
Vote Result: YES
Rationale
Increasing the RFs to incentivise migration from v2 to v3 makes sense and will not put user funds at risk of liquidation. Incrementally increasing the RF of unfrozen assets on v2 also allows for a gradual move and does not immediately destabilise the v2 market on Polygon. Therefore, we will vote YES in favour of this proposal.
MaticX Polygon Supply Cap Update
Vote Result: YES
Rationale
We previously voted YES for this AIP which failed to meet quorum according to our rationale here. Therefore, we will vote YES in favour of this proposal as well.
Gauntlet Risk Parameter Updates for Ethereum v3, Arbitrum v3, Ethereum v2
Vote Result: YES
Rationale
This is the on-chain vote for this Snapshot proposal that we voted in favour of according to our rationale here. Therefore, we will vote YES in favour of this AIP as well.
Chaos Labs Risk Parameter Update - MAI Aave V3
Vote Result: YES
Rationale
Since MAI has depegged, it is important to de-risk the Aave markets where the asset is listed and we are in complete support of this proposal. Therefore, we will vote YES in favour of this proposal.
Note: This applies to both the Snapshot for Avalanche and the AIP for other chains.
Set Metis Foundation Wallet as Emission Manager for METIS Token on Aave V3 Metis Pool
Vote Result: YES
Rationale
This is the on-chain vote for this Snapshot proposal that we voted in favour of according to our rationale here. Therefore, we will vote YES in favour of this AIP as well.
[TEMP CHECK] Introducing “Curator” by Llama
Vote Result: YES
Rationale
The Curator contract is important to allow Aave to swap assets in the most efficient, price-friendly manner as possible. Given the difficulty of exchanging assets with the Collector contract and the time and resource consumption every time assets are to be swapped, we think the Curator contract is a useful tool for the DAO and should be implemented at this stage in its development. Moreover, Llama has already started work on it and in parallel with the ARFC to cancel Llama’s service provider stream, we think it is beneficial for Aave to have Llama complete their outstanding work, especially given that the Curator contract is quite complex. Therefore, we will vote YES in favour of this proposal.
[ARFC] Gauntlet - Synchronicity Price Adapter “Killswitch” Functionality for LST Emode
Vote Result: OPTION 3 - LEVER B
Rationale
While Lever A is the strongest one and we think it does make sense, liquidating healthy positions even if done to reduce risk overall would be very detrimental for Aave users and should not be adopted as a policy. In this case, the best option is 3 (only Lever B) since this ends up preventing additional risk and can be activated in advance to prevent a situation from spiralling out of control. Even though this will reduce UX somewhat, the trade-off is much more favourable to us than liquidating healthy positions.
Therefore, we will vote YES in favour of Option 3 - Lever B.
[ARFC] GHO Liquidity Pools - Primary Pools Initial Strategy
Vote Result: YES
Rationale
This strategy will help onboard liquidity for GHO and has been in the works for some time and boosting incentives on Balancer via the veBAL boost is a good idea. Allocating most voting power to the USD based pools is sensible since these are most needed to strengthen GHO’s peg. A risk is that the voting power is boosted by the ‘Friends’ of Aave DAO and there is a risk to this, since their delegation is to be revisited in a short time and there is the chance of reduced incentives over time. This needs to be monitored and the strategy tweaked in case of any changes.
All in all, we will vote YES in favour of this proposal.
[ARFC] Aave V3 Deployment on Base
Vote Result: YES
Rationale
We voted YES in favour of this TEMP CHECK according to our rationale here, and are in favour of deploying on BASE. BGD has technically evaluated BASE and both service providers have given their risk recommendations. The entire deployment checklist has been met. Therefore, we will vote YES in favour of this proposal.
Acquire More aUSDC on Aave Ethereum Collector
Vote Result: YES
Rationale
Building up the runway in v2 to pay service providers is critical and deploying the balance for yield is also important to ensure capital efficiency of the treasury. Therefore, we will vote YES in favour of this proposal.
Chaos Labs Risk Parameter Updates - FEI on Aave V2 Ethereum
Vote Result: YES
Rationale
This is the on-chain vote for this Snapshot proposal that we voted in favour of according to our rationale here. Therefore, we will vote YES in favour of this AIP as well.
[ARFC] Cancel Llama Service Provider Stream
Vote Result: REDUCE STREAM
Rationale
Reducing Llama’s stream and signalling the impact of bad performance to service providers while reaching a middle ground and allowing Llama to complete outstanding work makes sense to us.
There was no displeasure about Llama’s services expressed previously, even if we did feel their performance was unsatisfactory. Llama, to their credit, have been open to communication and frequently post updates and hold Twitter Spaces where the displeasure with their performance could have been mentioned. However, this was not done and to cancel their stream without a warning would not be the right way in which Aave should handle service provider relationships.
We do agree that Llama’s performance has not been up to scratch and a reduced payment is necessary, but we also don’t think that passing on the work to other service providers at the moment is beneficial since that just entrenches their positions without there being a fair selection process for Llama’s scope to be handed over.
Therefore, we will vote to reduce Llama’s stream to 50% of the original amount.
[ARFC] BUSD Offboarding Plan Part III
Vote Result: YES
Rationale
We have voted YES in favour of previous BUSD offboarding proposals (rationales for Part I and Part II) and will vote YES in favour of this one as well.
[ARFC] Aave | Flipside Crypto Facilitator [v2]
Vote Result: YES
Rationale
Flipside has proven to be very useful for the DAO over the last few years. Compared to other providers the cost is reasonable, and it makes sense for the DAOs tasks to be spread out amongst a variety of providers - this has proven to be positive on the risk provider side of the DAO. Focusing on the operational efficiency side of things for governance is critical and having a dedicated focus on that is only beneficial for the DAO. BGD’s breakdown is very useful and in some areas that are ‘redundant’ we agree with Flipside that their role will help in spreading out responsibilities amongst the DAO and create (healthy) competition between service providers.
We do agree with BGD that some of the tasks outlined in the scope are redundant and the point about the data analytics made by BGD has merit to it. However, even in that case, we think the budget is fair and short-term and can be modified in 6 months, and provides further benefits than only the items in scope. We believe that diversity in and competition between service providers is only healthy for the DAO if it is done professionally, and this proposal aids in that mission.
Therefore, we will vote YES in favour of this proposal.
Reserve Factor Updates - Polygon Aave v2
Vote Result: YES
Rationale
This is the on-chain vote for this Snapshot proposal that we voted in favour of according to our rationale here. Therefore, we will vote YES in favour of this AIP as well.
TUSD Offboarding Plan
Vote Result: YES
Rationale
This is the on-chain vote for this Snapshot proposal that we voted in favour of according to our rationale here. Therefore, we will vote YES in favour of this AIP as well.
Gauntlet Recommendation for CRV LTV → 0 on Aave v2 Ethereum
Vote Result: YES
Rationale
We are in favour of setting LTV to 0 even though we think that this may not be the most effective lever given that it can be bypassed on v2.
We are in not in favour of freezing the market at the moment since it will not allow the user to top up his position with collateral in deteriorating liquidity conditions, the user has a good track record of loan repayments and maintaining a healthy position, and will get liquidated if there is a steep price drop which is very possible. However, we do take @WintermuteGovernance’s position into account, and think that over the longer term if LT/LTV reductions do not prove to be good enough incentives for the user to pay his position back, a freeze of the market may be necessary to make sure the position is paid back.
We think LT reductions should be paused for the moment until there is more stability and market conditions are reevaluated. We also agree with Chaos Labs in disabling CRV borrows on Ethereum and Polygon v3.
Therefore, we will vote YES in favour of this AIP.
Cancel Llama Streams
Vote Result: YES
Rationale
This is the on-chain implementation for this Snapshot proposal where we voted to reduce Llama’s stream according to our rationale here. Therefore, we will vote YES in favour of this AIP.
Gauntlet Recommendation to Reduce CRV LT, LTV, Debt Ceiling on V3 Ethereum and CRV LT, LTV on V3 Polygon
Vote Result: YES
Rationale
Given the nature of the CRV situation and the need to de-risk the asset, this proposal makes sense. Chaos Labs is also in agreement. Therefore, we will vote YES in favour of this proposal.
[ARFC] Activate LUSD as Collateral on Aave V3 ETH Pool
Vote Result: YES
Rationale
LUSD is a decentralised stablecoin that has proven its resilience. We are in favour of encouraging stablecoin growth. The risk parameters are conservative and appropriate to the market conditions and are supported by Chaos Labs. Therefore, we will vote YES in favour of this proposal.