Here, we’ll start a running thread where we voice our opinions regarding our decisions to different proposals on the forums.
For Background, hello everyone! We’re Penn Blockchain (@PennBlockchain on twitter), a leading, completely student run blockchain DAO from The University of Pennsylvania for both our undergraduate and graduate schools. The club currently has over 50 members and we’re expecting many more each semester!
Penn Blockchain has committees covering Governance, Research, Education, Business Development, and Development/Web3. On the governance side of things, our team has different members leading governance initiatives for different protocols we have delegations for. Current Penn Blockchain delegations include Maker, Compound, Uniswap, DyDx, IndexCoop, etc.
Each week, governance leads will share updates with the club about new proposals and we will all debate about what to do before voting with our wallet. Our internal voting process takes place on the weekends and is an equal weighted democratic process. Proposals that will expire before the weekend are debated on our internal messaging platforms with a majority vote being our overall end vote.
We look forward to staying active within Aave and thank the community for their hard work!
We voted NO: Our Main concern is RSR token is subject to pretty wild on chain price movements:
According to this graph on 6/29; over a 5 hr period the price more than doubled on chain before crashing down another 50%. A majority of this is due to incredibly low on chain liquidity (<100k on uni) which allows any “miniature whale” to wildly manipulate the price.
Even though only borrowable and not as collateral, some positions can easily assume bad debt if RSR price fluctuates too quickly. From Aave’s perspective, the extra profit generated doesn’t seem to outweigh potential bad debt risks. Aside from us, and “aavechan.eth," there was only like a total of 5k other Aave voting. Curious what the poor voter turnout stemmed from.
Overall, Reserve is a super cool protocol and many of us have been following for a long time. We just didn’t think in the current state of DeFi, adding tokens with very low on chain liquidity would prove overall beneficialness for Aave. While Chainlink should hopefully keep general oracle price accurately, the risks don’t seem to outweigh the marginal returns.
We voted YES: Pretty simple move, benefits are worth it.
Enable agEUR as a collateral in isolation mode on V3 on Polygon
We voted YES: Angle’s Euro stablecoin has shown itself to be the blue chip EURO reflective coin the last few years and adding it in isolation mode on Polygon v3 where there’s deepest liquidity is a very reasonable and beneficial trial period before revisiting if we want to remove the “training wheels.”
We voted Yes, Freeze Harmony V3 Market: What happened a few weeks ago on Harmony was incredibly tragic and our heart goes out everyone that was affected. This is just another case of the need to have better and better wallet security. As for Aave, the safest thing to do is to freeze reserves until the situation is hopefully sorted out/saved. In the meanwhile, only allowing repayment of loans for recollection of collateral is the safest option when many assets are wildly moving in price.
Sigma Prime - Security Assessment Services for Aave
We voted YES: It was a no brainer in deciding that Aave should have constant auditing/security assessment around the clock that is continuously being updated and revisited. A great firm in that of Sigma Prime to provide these services seems fair enough to us!
We voted YES: Excellent work once again done by Llama. Taking into the risk assessment for adding 1INCH to v2, we find the revenue and protocol benefits associated with adding 1INCH to Aave greater than extra added risks.
We voted FOR: Like some other blue chip protocols, we think there needs to be a distinguishing factor between high and low level governance votes and there’s no reason they should have the same governance timeline. The framework laid out for Level 2 requirements is significantly better than the prior. One thought fwiw is that the vote differential between needed to pass a Level 2 seems a bit steep; decreasing it by ~5% was an initial thought, but we’ll have to see how many, if any, votes get caught up in this buffer and if we want to change that.
Hey @PennBlockchain - this running thread is a great idea. Would also love to have you on a future community call to introduce your platform for anyone listening who may be interested in delegating. The next one is scheduled for July 27 at 2:00pm UTC or the one after that will be end of August. lmk!
We voted YAE: Securitize is one of the leading digital asset securities companies and one of the most regulated firms in the entire digital assets industry. Adding then as a trusted gatekeeper for Aave Arc, only wallets with verified credentials can get access to permissioned liquidity pools, and therefore only institutions can only safely leverage up.
Add 1INCH to Aave v2 market
We voted YAE: Continuation vote of prior approval from us. We think 1INCH has passed all the checks needed to be added to Aave and will be overall beneficial to the protocol.
Risk-Off Framework for the Aave Protocol
We voted 3%: The higher max LT reduction will strengthen Aave’s ability to maximize capital efficiency under favorable markets but a higher potential for risk-off liquidations. Overall, we thought this was appropriate as we still think Aave is very safe and in tumultuous times, can still safely handle markets a while maximizing capital efficiency.
ARC: Extend the Safety Module Protection to Aave V2 Polygon & ARC: Extend the Safety Module Protection to Aave V2 Arc & ARC: Extend the Safety Module Protection to Aave V2 Avalanche
We voted YES: Voted Yes for all three. No reason not to add the beneficial safety module over to the different ARC markets.
ARC: Add support for BTC.b (Native Bitcoin bridged to Avalanche)
We voted YES: BTC.b is the native bridged version of bitcoin from the Avalanche BTC bridge. This token has proven strong enough even in volatile markets and is a very safely audited reflection of BTC, so we feel safe adding it to Avax markets.
We voted YES: This is what we love to see. Very interesting approach to GHO and 100% greenlight to explore looking more into this. The part on yield bearing assets as collateral is a bit interesting and something that will need to fleshed out a bit more. Overall, we’re confident Aave has the team and knowledge/expertise to build a safe and stable in house stablecoin, and are excited to see where and how this transitions/get’s implemented!
Hi team - thanks for creating this platform. It is clear you have used your experience in Maker and modeled it to Aave. It feels beneficial to have more clarity on decisions and rationale from delegates.
After kitting up this “platform,” we were curious about its effect on your delegation - as delegation is pretty new and unknown to most Aave users.
Here’s the result:
Right now Penn Blockchain is the 7th largest delegate with 10,046.36 voting power via 2 delegators. Your decisions have been 93.75% towards YES - with 30 YES and 2 NOs.
Seems as a whole delegation for Aave is limited but growing. Participation rates in recent proposals have jumped as well, reaching 527 voters at its height.
Hey Fig, thanks so much for this message! We’re actually talking with Nhat from your team right now regarding who our delegates are and other Aave related things. Super excited to see the dashboard play out as it’s something Aave definitely needs. Overall, would be interesting to track how the Snapshot votes are as well, as much more votes happen over there, participation is significantly worse, and we’ve been able to be much more active and influential relative to the total number of votes.
Once again, thanks and looking forward to the dashboard!
We voted YES: For the main part, we agree with Gauntlet’s analysis and agree with the risk parameter updates. PS: Very cool to see the snapshot voting confirmation screen’s update that lets you share directly to Twitter!
[ARC] Increase Supply Cap of sUSD on v3 Optimism to 20m (Fast-track)
We voted YES: Seems like Synthetix has found a happy place on Optimism recently and is continuously flourishing. We’re looking forward to this increase on the supply cap as it will allow for more usage and revenue for Aave.
Parameter Change Disclaimer in Borrow User Interface
We voted YES: We have never considered this, but it seems simple and practical enough. Just like the disclaimer that tells you your health factor will decrease when you borrow assets, the same type of disclaimer saying your LTV and token specific parameters can change too is also very practical and from a legal standpoint seems better than not.
We voted YAE: “The Fantom Aave V3 market did not gain noticeable traction with a current market size of 9M$ and 2.4M$ of open borrowing position, this led to a market generating on average 300$ of fees daily for the protocol (~30$ of daily fees for the Aave treasury)” Seeing that the Aave Fantom market has not been increasing, and the treasury is earning only $30 a day, the inherit costs associated with up keep and possible smart contract breach compromising Aave reputation just isn’t enough in our opinion to justify keeping this market live.
We voted YES: The community guardian will as stated, be temporary and allow V3 markets to be upgraded to the cross chain governance module. We think these added multisig signers is a good refresher and something that should be done periodically. FWIW, We would love to be considered down the line to be on the multisig.
We voted YAE: Continued great analysis done by the Gauntlet team. Well researched and explained, fully support.
ARC: Add OP as Collateral to AAVE v3
We voted YES: This would be following precendent set by other V3 chains to have the chain’s native token added as collateral. Overall, we think OP has survived enough “trials and tribulations” and has sufficient on chain liquidity to be added as a V3 collateral.