aaveSource: Aave governor v2 · #33
LTV and Liquidation Threshold Updates to Moderate Levels
executedSep 12, 2021, 07:27 PM UTCby680x683a…6c02
01Summary
AISummary by Kvorumclaude-haiku-4-5
Updates LTV (Loan-to-Value) and liquidation threshold parameters for 20 assets on Aave V2 based on Gauntlet's risk modeling. The community selected a 'Moderate' risk tolerance via Snapshot poll. Changes reflect improved market data on volatility, slippage, and user behavior to standardize Value-at-Risk across assets and protect the Safety Module.
- Type
- parameter change
Key changes
- LTV and liquidation threshold updates for AAVE: LTV 60% to 60%, liquidation threshold 70% to 70%, with cooldown period 10800(high)
- LTV and liquidation threshold updates for BAL: LTV 65% to 65%, liquidation threshold 70% to 70%, with cooldown period 11000(high)
- LTV and liquidation threshold updates for BAT: LTV 70% to 70%, liquidation threshold 75% to 75%, with cooldown period 10900(high)
- LTV and liquidation threshold updates for CRV: LTV 40% to 40%, liquidation threshold 55% to 55%, with cooldown period 11250(high)
- LTV and liquidation threshold updates for DAI: LTV 75% to 75%, liquidation threshold 80% to 80%, with cooldown period 10500(high)
- LTV and liquidation threshold updates for DPI: LTV 60% to 60%, liquidation threshold 70% to 70%, with cooldown period 11000(high)
- LTV and liquidation threshold updates for ENJ: LTV 50% to 50%, liquidation threshold 60% to 60%, with cooldown period 11000(high)
- LTV and liquidation threshold updates for KNC: LTV 60% to 60%, liquidation threshold 70% to 70%, with cooldown period 11000(high)
Notable concerns
- SNX has very high volatility (1.86) and high slippage (-17.007 intensity), requiring larger buffer between LTV and liquidation threshold
- CRV has high volatility (1.4) and the proposal sets relatively conservative LTV of 40%
- YFI liquidation buffer shrinks due to marginal increase in liquidations observed during simulation
Contracts0x311bb771e4f8952e6da169b425e7e92d6ac45756
Generated by Kvorum
model: claude-haiku-4-5
provider: anthropic
profile: anthropic-fast-v1
prompt: v1.0
generated: 2mo ago
02Description
561 words
Simple Summary
Three distinct levels from which the community can select a preferred risk tolerance for Aave V2. "Moderate" was chosen via Snapshot poll.
Abstract
From a market risk perspective, the goal for Gauntlet’s simulations is to standardize Value-at-Risk (VaR) across all assets. Matching risk tolerance to a normalized expected yield throughout Aave V2 ensures no subset of assets adds disproportionate risk to the Safety Module.
Following asset onboarding, empirical data on user behaviour (e.g., average health factors) and changes in market conditions (e.g., expected slippage) improve our simulation precision. Improved precision allows for higher confidence in model outputs—particulary for aggressive recommendations.
Gauging risk appetite is something Gauntlet will do quarterly to ensure our risk parameter recommendations track the preference of the Aave community.
Motivation
The existing risk framework has been instrumental in facilitating onboarding new assets. As expected and observed, liquidity risk, volatility risk, and market capitalization frequently change for all assets on Aave. Updating LTV and Liquidation thresholds to remain in lockstep with the market is key to improving the target metrics outlined in Gauntlet's Dynamic Risk Parameters proposal.
Key Model Inputs & Notes
| Asset | Volatility |
|---|---|
| USDC | 0.014 |
| DAI | 0.017 |
| TUSD | 0.031 |
| WBTC | 0.72 |
| WETH | 0.994 |
| REN | 1.05 |
| BAT | 1.08 |
| YFI | 1.11 |
| DPI | 1.12 |
| LINK | 1.16 |
| BAL | 1.17 |
| MKR | 1.255 |
| ZRX | 1.311 |
| UNI | 1.331 |
| KNC | 1.357 |
| CRV | 1.4 |
| XSUSHI | 1.51 |
| ENJ | 1.612 |
| AAVE | 1.72 |
| SNX | 1.86 |
- WBTC: Downside slippage values for WBTC have become smaller. This means liquidators see less slippage on trades and more liquidity. Additionally, a tight liquidation buffer will suffice given the lower market volatility.
- YFI: Both slippage values and volatility have improved for YFI. The liquidation buffer shrinks between conservative and aggressive parameters due to marginal increase of liquidations observed during simulation. Doing so provides users an option to be more aggressive with starting positions should they choose.
- LINK: Given market liquidity and LINK supplier's borrow positions, the aggressive setting will only include an increase in liquidation threshold.
- xSUSHI: Recent liquidation analysis on empirical data, lacking previously, provides higher confidence that insolvency events can be mitigated.
- SNX: The major concern with for SNX is that there is very high volatility and high slippage. The aggressive setting requires a larger delta between LTV and liquidation threshold to compensate for the additional risk.
| Asset | Slippage Intensity Sell | Slippage Power Sell |
|---|---|---|
| WBTC | -0.134 | 0.52 |
| YFI | -1.003 | 1.008 |
| LINK | -5.648 | 1.14 |
| XSUSHI | -0.864 | 1.049 |
| SNX | -17.007 | 1.477 |
Slippage calculation takes the form below:
Implementation
The proposal sets the LTV and liquidation threshold ratios by calling configureReserveAsCollateral on the LendingPoolConfigurator contract at 0x311Bb771e4F8952E6Da169b425E7e92d6Ac45756, using the address and parameters specific to each token.
Full list of parameter updates can be found here.
Copyright
Copyright and related rights waived via CC0.****
03Mismatch analysis
AIMismatch analysis by Kvorum
A calldata-vs-description analysis is not generated yet. Review the decoded actions →
04Actions
21 total
#0configureReserveAsCollateral(address,uint256,uint256,uint256)chain 0x1
- Target
- 0x311b…5756
- Value
- 0 wei
- Function
- configureReserveAsCollateral(address,uint256,uint256,uint256)
- Arguments
{ "0": "0x7Fc66500c84A76Ad7e9c93437bFc5Ac33E2DDaE9", "1": "6000", "2": "7000", "3": "10800" }- Calldata
#1configureReserveAsCollateral(address,uint256,uint256,uint256)chain 0x1
- Target
- 0x311b…5756
- Value
- 0 wei
- Function
- configureReserveAsCollateral(address,uint256,uint256,uint256)
- Arguments
{ "0": "0xba100000625a3754423978a60c9317c58a424e3D", "1": "6500", "2": "7000", "3": "11000" }- Calldata
#2configureReserveAsCollateral(address,uint256,uint256,uint256)chain 0x1
- Target
- 0x311b…5756
- Value
- 0 wei
- Function
- configureReserveAsCollateral(address,uint256,uint256,uint256)
- Arguments
{ "0": "0x0D8775F648430679A709E98d2b0Cb6250d2887EF", "1": "7000", "2": "7500", "3": "10900" }- Calldata
#3configureReserveAsCollateral(address,uint256,uint256,uint256)chain 0x1
- Target
- 0x311b…5756
- Value
- 0 wei
- Function
- configureReserveAsCollateral(address,uint256,uint256,uint256)
- Arguments
{ "0": "0xD533a949740bb3306d119CC777fa900bA034cd52", "1": "4000", "2": "5500", "3": "11250" }- Calldata
#4configureReserveAsCollateral(address,uint256,uint256,uint256)chain 0x1
- Target
- 0x311b…5756
- Value
- 0 wei
- Function
- configureReserveAsCollateral(address,uint256,uint256,uint256)
- Arguments
{ "0": "0x6B175474E89094C44Da98b954EedeAC495271d0F", "1": "7500", "2": "8000", "3": "10500" }- Calldata
#5configureReserveAsCollateral(address,uint256,uint256,uint256)chain 0x1
- Target
- 0x311b…5756
- Value
- 0 wei
- Function
- configureReserveAsCollateral(address,uint256,uint256,uint256)
- Arguments
{ "0": "0x1494CA1F11D487c2bBe4543E90080AeBa4BA3C2b", "1": "6000", "2": "7000", "3": "11000" }- Calldata
#6configureReserveAsCollateral(address,uint256,uint256,uint256)chain 0x1
- Target
- 0x311b…5756
- Value
- 0 wei
- Function
- configureReserveAsCollateral(address,uint256,uint256,uint256)
- Arguments
{ "0": "0xF629cBd94d3791C9250152BD8dfBDF380E2a3B9c", "1": "5000", "2": "6000", "3": "11000" }- Calldata
#7configureReserveAsCollateral(address,uint256,uint256,uint256)chain 0x1
- Target
- 0x311b…5756
- Value
- 0 wei
- Function
- configureReserveAsCollateral(address,uint256,uint256,uint256)
- Arguments
{ "0": "0xdd974D5C2e2928deA5F71b9825b8b646686BD200", "1": "6000", "2": "7000", "3": "11000" }- Calldata
#8configureReserveAsCollateral(address,uint256,uint256,uint256)chain 0x1
- Target
- 0x311b…5756
- Value
- 0 wei
- Function
- configureReserveAsCollateral(address,uint256,uint256,uint256)
- Arguments
{ "0": "0x514910771AF9Ca656af840dff83E8264EcF986CA", "1": "7000", "2": "7500", "3": "11000" }- Calldata
#9configureReserveAsCollateral(address,uint256,uint256,uint256)chain 0x1
- Target
- 0x311b…5756
- Value
- 0 wei
- Function
- configureReserveAsCollateral(address,uint256,uint256,uint256)
- Arguments
{ "0": "0x0F5D2fB29fb7d3CFeE444a200298f468908cC942", "1": "6000", "2": "6500", "3": "10800" }- Calldata
#10configureReserveAsCollateral(address,uint256,uint256,uint256)chain 0x1
- Target
- 0x311b…5756
- Value
- 0 wei
- Function
- configureReserveAsCollateral(address,uint256,uint256,uint256)
- Arguments
{ "0": "0x9f8F72aA9304c8B593d555F12eF6589cC3A579A2", "1": "6500", "2": "7000", "3": "11000" }- Calldata
#11configureReserveAsCollateral(address,uint256,uint256,uint256)chain 0x1
- Target
- 0x311b…5756
- Value
- 0 wei
- Function
- configureReserveAsCollateral(address,uint256,uint256,uint256)
- Arguments
{ "0": "0x408e41876cCCDC0F92210600ef50372656052a38", "1": "5500", "2": "6000", "3": "10900" }- Calldata
#12configureReserveAsCollateral(address,uint256,uint256,uint256)chain 0x1
- Target
- 0x311b…5756
- Value
- 0 wei
- Function
- configureReserveAsCollateral(address,uint256,uint256,uint256)
- Arguments
{ "0": "0xC011a73ee8576Fb46F5E1c5751cA3B9Fe0af2a6F", "1": "2000", "2": "4500", "3": "10900" }- Calldata
#13configureReserveAsCollateral(address,uint256,uint256,uint256)chain 0x1
- Target
- 0x311b…5756
- Value
- 0 wei
- Function
- configureReserveAsCollateral(address,uint256,uint256,uint256)
- Arguments
{ "0": "0x8798249c2E607446EfB7Ad49eC89dD1865Ff4272", "1": "3500", "2": "6000", "3": "11250" }- Calldata
#14configureReserveAsCollateral(address,uint256,uint256,uint256)chain 0x1
- Target
- 0x311b…5756
- Value
- 0 wei
- Function
- configureReserveAsCollateral(address,uint256,uint256,uint256)
- Arguments
{ "0": "0x0000000000085d4780B73119b644AE5ecd22b376", "1": "8000", "2": "8250", "3": "10500" }- Calldata
#15configureReserveAsCollateral(address,uint256,uint256,uint256)chain 0x1
- Target
- 0x311b…5756
- Value
- 0 wei
- Function
- configureReserveAsCollateral(address,uint256,uint256,uint256)
- Arguments
{ "0": "0x1f9840a85d5aF5bf1D1762F925BDADdC4201F984", "1": "6000", "2": "7000", "3": "11000" }- Calldata
#16configureReserveAsCollateral(address,uint256,uint256,uint256)chain 0x1
- Target
- 0x311b…5756
- Value
- 0 wei
- Function
- configureReserveAsCollateral(address,uint256,uint256,uint256)
- Arguments
{ "0": "0xA0b86991c6218b36c1d19D4a2e9Eb0cE3606eB48", "1": "8250", "2": "8500", "3": "10500" }- Calldata
#17configureReserveAsCollateral(address,uint256,uint256,uint256)chain 0x1
- Target
- 0x311b…5756
- Value
- 0 wei
- Function
- configureReserveAsCollateral(address,uint256,uint256,uint256)
- Arguments
{ "0": "0x2260FAC5E5542a773Aa44fBCfeDf7C193bc2C599", "1": "7000", "2": "7500", "3": "10900" }- Calldata
#18configureReserveAsCollateral(address,uint256,uint256,uint256)chain 0x1
- Target
- 0x311b…5756
- Value
- 0 wei
- Function
- configureReserveAsCollateral(address,uint256,uint256,uint256)
- Arguments
{ "0": "0xC02aaA39b223FE8D0A0e5C4F27eAD9083C756Cc2", "1": "8000", "2": "8500", "3": "10500" }- Calldata
#19configureReserveAsCollateral(address,uint256,uint256,uint256)chain 0x1
- Target
- 0x311b…5756
- Value
- 0 wei
- Function
- configureReserveAsCollateral(address,uint256,uint256,uint256)
- Arguments
{ "0": "0x0bc529c00C6401aEF6D220BE8C6Ea1667F6Ad93e", "1": "4500", "2": "6000", "3": "11250" }- Calldata
#20configureReserveAsCollateral(address,uint256,uint256,uint256)chain 0x1
- Target
- 0x311b…5756
- Value
- 0 wei
- Function
- configureReserveAsCollateral(address,uint256,uint256,uint256)
- Arguments
{ "0": "0xE41d2489571d322189246DaFA5ebDe1F4699F498", "1": "6000", "2": "7000", "3": "10800" }- Calldata
05Tally
Summed from votes
Against0.0%0.1
For100.0%509.4K
Voters15
VP participating509.4K
Outcome (current)For
Current support100%
06Voters
15 total
Filter:
| Voter | Choice | % of total | Rationale | ||
|---|---|---|---|---|---|
| 470x47c1…4770 | For | 245.2K | 48.13% | — | 5y ago |
| 100x10f8…1f92 | For | 114.9K | 22.56% | — | 5y ago |
| 0C0x0c94…297b | For | 74.5K | 14.63% | — | 5y ago |
| FC0xfc56…5e0c | For | 64.9K | 12.74% | — | 5y ago |
| 700x704d…a0df | For | 3.8K | 0.76% | — | 5y ago |
| 680x683a…6c02 | For | 3.1K | 0.61% | — | 5y ago |
| 800x80dc…c146 | For | 2.7K | 0.53% | — | 5y ago |
| 1B0x1b48…f97b | For | 85.4 | 0.02% | — | 5y ago |
| 7F0x7f18…caed | For | 75.1 | 0.01% | — | 5y ago |
| F10xf191…7914 | For | 49.6 | 0.01% | — | 5y ago |
| 950x956f…3f92 | For | 31 | 0.01% | — | 5y ago |
| 270x2713…d6e5 | For | 15.3 | 0.00% | — | 5y ago |
| AE0xae91…9b34 | For | 10.3 | 0.00% | — | 5y ago |
| B00xb014…bcc7 | For | 2 | 0.00% | — | 5y ago |
| 4A0x4a5e…95dc | Against | 0.1 | 0.00% | — | 5y ago |
Showing 15
07Forum
No forum thread is confidently linked to this proposal.
08Similar proposals
AI · embeddings
- aaveexecutedRisk Parameter Updates for Aave V2 assets89%
- aaveexecutedRisk Parameter Updates for Aave V2 (2022-09-22)88%
- aaveexecutedRisk Parameter Updates for Aave V2 (2022-08-18)88%
- aaveexecutedRisk Parameter Updates 2021-10-1488%
- aaveexecutedRisk Parameter Updates for Aave V2 (2022-08-03)88%
- aaveexecutedRisk Parameter Updates 2022-02-1088%
- aavecanceledRisk Parameter Updates 2022-05-0587%
- aaveexecutedRisk Parameter Updates 2022-03-2287%
- aavedefeatedRisk Parameter Updates 2021-12-2987%
- aaveexecutedRisk Parameter Updates 2021-10-0787%