DAI Liquidation Event

Thanks for kicking this off!

IMO this looks like a good start. As far as I can tell the “real damage” is accurate, and I think compensating with Dai reserve seems fair, for both the effected users and the people in the community. The only thing is from what I can tell, there is only ~2M in Dai reserve right now, so the compensation may need to be distributed over time, or be discounted, or both.

I think it would be useful to get consensus on whether the compensation should be discounted and if so, what the % should be.

I also agree that it doesn’t make sense or is necessary to modulate compensation amounts arbitrarily based on user behavior. If people have issues with recursive yield farming, the right way to address this is to change the incentive so that yield farmers naturally move away; instead of randomly punish a subset of those people by not compensating in this or other similar events.

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