Risk Parameter Updates for AAVE V2 Ethereum

Summary

Gauntlet recommends to freeze CRV and set CRV LTV -> 0 on Aave v2 Ethereum.

Motivation

Gauntlet has been looking into the risk profile of 0x7a16ff8270133f063aab6c9977183d9e72835428. This account borrows roughly $63m of USDST against $190m of CRV, as of 2023/06/13. We recommend to 1. freeze CRV collateral and 2. set Curve LTV to 0, to prevent the account from continuing to add CRV and increasing concentration risk, due to the decrease in CRV liquidity over the past few months.

Specification

Freeze CRV, set CRV LTV -> 0 on Aave v2 Ethereum.

Implementation

The proposal implements changes on Aave v2 Ethereum using the freezeReserve and configureReserveAsCollateral methods of the LendingPoolConfigurator.

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. This message is for informational purposes only and does not constitute an offer to sell, a solicitation to buy, or a recommendation for any security, nor does it constitute an offer to provide investment advisory or other services by Gauntlet Networks Inc. No reference to any specific security constitutes a recommendation to buy, sell or hold that security or any other security. Nothing in this report shall be considered a solicitation or offer to buy or sell any security, future, option or other financial instrument or to offer or provide any investment advice or service to any person in any jurisdiction. Nothing contained in this report constitutes investment advice or offers any opinion with respect to the suitability of any security, and the views expressed in this report should not be taken as advice to buy, sell or hold any security. The information in this report should not be relied upon for the purpose of investing. In preparing the information contained in this report, we have not taken into account the investment needs, objectives and financial circumstances of any particular investor. This information has no regard to the specific investment objectives, financial situation and particular needs of any specific recipient of this information and investments discussed may not be suitable for all investors. Any views expressed in this report by us were prepared based upon the information available to us at the time such views were written. Changed or additional information could cause such views to change. All information is subject to possible correction. Information may quickly become unreliable for various reasons, including changes in market conditions or economic circumstances.