Gauntlet <> Aave Renewal
01Summary
Renew Gauntlet's 12-month risk management engagement for Aave v2 and v3 markets from Dec 28, 2022 to Dec 28, 2023, paying $2M annually (70% in aUSDC, 30% in AAVE tokens), with funds streamed linearly over the year and 30% held in an insolvency refund vault.
- Type
- treasury allocation
- Funding
- $2000000
Key changes
- Gauntlet engagement renewal for continuous market risk management, economic stress testing, and dynamic parameter calibration across Aave v2 and v3(high)
- Annual payment of $2,000,000 structured as $1,400,000 in aUSDC and 9,919 AAVE tokens(high)
- 600,000 USDC deposited in insolvency refund vault, with remaining 800,000 aUSDC and 9,919 AAVE streamed linearly over 12 months(medium)
Generated by Kvorum
02Description
Summary
A proposal to renew Gauntlet’s 12-month engagement with Aave on continuous market risk management to maximize capital efficiency while minimizing the risk of insolvency and liquidations to create long-term sustainable growth. Full details of the proposal can be found in our forum post. The engagement was pre-approved by the Aave community via Snapshot.
Proposal
Gauntlet’s Risk Management platform quantifies risk, optimizes risk parameters, runs economic stress tests, and calibrates parameters dynamically. Gauntlet uses agent-based simulation models tuned to actual market data to model tail market events and interactions between different users within DeFi protocols.
The engagement runs from Dec 28, 2022 to Dec 28, 2023 and includes risk management coverage of all Aave v2 and v3 markets. The total annual fee is $2,000,000 - 70% is paid in aUSDC (1,400,000) and 30% in AAVE (9,919 AAVE tokens).
Full details of the engagement scope, integration timeline, and KPIs are covered in our forum post.
Specification
A full specification of the payload contract and tests enabling this proposal can be found on Gauntlet's Github here.
The Proposal Payload does the following:
- 30% of the total annual fee (600,000 in USDC) will be deposited in a vault for the insolvency refund.
- The remaining 800,000 in aUSDC and 9,919 AAVE tokens will be streamed linearly over 1 year.
Implementation
The Proposal Payload has been tested and peer-reviewed by Bored Ghost Developing, including simulations on mainnet of the whole proposal lifecycle.
Link to Test Cases: ProposalPayloadE2E.t.sol
Link to Payload implementation: ProposalPayload.sol
Deployed Contracts: ProposalPayload = 0x03232b5ee80369a88620615f8328beec1884b731
Thank you to the Llama team for providing open source governance tooling that we used to prepare this proposal.
Copyright
Copyright and related rights waived via CC0.
By approving this proposal, you agree that any services provided by Gauntlet shall be governed by the terms of service available at gauntlet.network/tos.
03Mismatch analysis
The proposal uses the standard Aave governance pattern where a single payload contract's execute() function is called, and that contract internally performs all the granular actions (vault deposit, token transfers, stream creation) described in the prose. The decoded calldata only shows this single top-level call with no arguments, since the payload's internal logic is not represented as separate decoded sub-actions. This means there is no on-chain evidence in the provided decode that contradicts the description's claims about the 600,000 USDC vault deposit or the 800,000 aUSDC / 9,919 AAVE linear stream — but there is also no way to directly verify these specific figures from the calldata alone, since they are encoded inside the payload contract's bytecode/logic rather than exposed as arguments. Given the proposal contract address matches the one linked in the description's 'Deployed Contracts' section, and this pattern (single execute() call to an audited payload) is standard practice for Aave governance proposals reviewed by BGD Labs, I find no basis to flag a discrepancy. However, because the actual dollar amounts, vault address, and streaming parameters cannot be independently confirmed from the decoded action alone, confidence in a full match is low rather than high.pt
Generated by Kvorum
04Actions
- Target
- 0x0323…b731
- Value
- 0 wei
- Function
- fallback()
- Arguments
{}- Calldata
05Tally
Summed from votes
06Voters
No votes recorded yet.
07Forum
- [ARC] Updated: Gauntlet <> Aave Renewal ↗discourse · high confidence
- [ARC] Gauntlet <> Aave Renewal ↗discourse · medium confidence
Arguments for
- Gauntlet has a strong two-year track record of parameter optimizations, risk modeling, and community engagement that generated measurable value (e.g., $3.7M additional borrow interest income) with no major insolvencies.— Pauljlei
- The updated proposal incorporates prior community feedback by adding a more proactive incident response process, an asset delisting process, and a public risk framework/risk council collaboration.— Pauljlei
- The proposal increases transparency via an updated dashboard, more educational content, and added context on parameter recommendations.— Pauljlei
- Gauntlet's willingness to switch from a variable/debt-based fee to a fixed $2M annual fee addressed the community's main pricing concern, making the proposal acceptable.— MarcZeller, fig, Pauljlei
- Gauntlet is a valuable, proven third-party risk manager and fair work deserves fair pay, warranting continued engagement.— MarcZeller, fig
- New features like the insolvency refund mechanism increase Gauntlet's alignment ('skin in the game') with Aave's interests.— Pauljlei
Arguments against
- The original debt-based/variable pricing model would let Gauntlet's revenue scale up with factors unrelated to their effort, such as liquidity mining, eMode adoption, new deployments, and bull markets, effectively giving them a 'free carry' on growth they didn't drive.— MatthewGraham
- A commission-based model tied to total debt could inflate costs unpredictably as Aave expands to new markets (e.g., Polygon v3) or as GHO debt grows, making the true cost of the proposal misleading if only the current lower bull/bear-market figure is quoted.— MatthewGraham
- Service providers should be priced with fixed, predictable annual budgets rather than usage-based commissions, and this standard should apply across all Aave service providers to allow fair comparison and budget planning (e.g., leaving room for Chaos Labs or a third risk provider).— MatthewGraham, MarcZeller
Unresolved concerns
- Whether GHO debt would be included or excluded from the Total Debt calculation under the original pricing model was not clearly confirmed before the model was changed to fixed fee.— MatthewGraham
- No standardized fixed-fee pricing framework across all Aave service providers was established, despite calls for this as a broader precedent.— MatthewGraham, MarcZeller
Notable participants
- PauljleiProposer from Gauntlet who presented the renewal proposal, responded to feedback, and updated the pricing model to fixed fee.
- MatthewGrahamRaised detailed, substantive concerns about the debt-based pricing model and its potential for unpredictable cost escalation, advocating for a fixed fee.
- MarcZellerRepresented the ACI, echoed Matthew's pricing concerns, and ultimately expressed full support once pricing was changed.
- figExpressed support for the proposal while acknowledging the pricing concerns raised by others.
- dtalwarGauntlet representative who confirmed the on-chain proposal passed and reaffirmed commitment to the engagement.
Generated by Kvorum
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