Risk Parameter Updates 2021-10-07
A proposal to adjust thirteen (13) total risk parameters across eleven (11) Aave V2 assets including LTV, Liquidation Threshold, and Liquidation Bonus.
This proposal is a batch update of three risk parameters to align with the Moderate risk level chosen by the Aave community. These parameter updates are a continuation of Gauntlet's regular parameter recommendations, the latest being AIP-39: Risk Parameter Updates for Aave V2 assets.
This set of parameter updates seeks to maintain the overall risk tolerance of the protocol while making risk trade-offs between specific assets. Volatility for non-stablecoin crypto assets remains high. As such, we focused on supporting protocol safety for our parameter changes in this cycle.
Adjustments were also made for three liquidation bonus values. These assets (UNI, BAL, LINK) saw increases in liquidity and trading volume and a reduced liquidation recommended value as a result. As always, simulation recommended values seek to maintain capital efficiency and uphold borrow usage levels.
|Parameter||Current Value||Recommended Value|
|REN Loan To Value||55%||50%|
|SNX Loan To Value||20%||30%|
|SNX Liquidation Threshold||45.0%||55.0%|
|DPI Loan To Value||60%||55%|
|UNI Loan To Value||60%||55%|
|UNI Liquidation Bonus||10.0%||8.0%|
|YFI Loan To Value||45%||50%|
|BAL Liquidation Bonus||10.0%||8.0%|
|LINK Liquidation Bonus||10.0%||7.5%|
|BAT Liquidation Threshold||75.0%||80.0%|
|ENJ Liquidation Threshold||60.0%||65.0%|
|MANA Liquidation Threshold||65.0%||75.0%|
|ZRX Liquidation Threshold||70.0%||75.0%|
The proposal sets the LTV, liquidation bonuses, and liquidation threshold ratios by calling
configureReserveAsCollateral on the
LendingPoolConfigurator contract at
0x311Bb771e4F8952E6Da169b425E7e92d6Ac45756, using the address and parameters specific to each token.
The full list of parameter updates can be found in the forum.
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