July 2023
Summary
Sharing a recap of Gauntlet’s market risk management work with Compound in July 2023. See below for this past month’s work summary and a preview of what’s coming up in August.
Highlights
- Paused supply for tail assets on Compound v2
- Conducted market risk analysis on the mechanism design of the WETH comet
- Proposed v2 Deprecation Strategy
- On-chain proposal for Arbitrum USDC rewards changes passed
- Initial parameter recommendations for Compound V3 USDC and WETH Comets on Base
- Published weekly market updates for all Compound comets: Ethereum USDC, Polygon USDC, Ethereum WETH, Arbitrum USDC
| Category | Work Completed | Commmentary |
|---|---|---|
| Quantitative Research | Mechanism Design Analysis on WETH Comet Continuous research on Incentive Optimization for Compound’s incentive rewards |
Incentives are used to bootstrap liquidity, promote growth, and facilitate decentralized governance growth. |
| Recommendations | Executed pausing supply for cAAVE, cCOMP, cLINK, cSUSHI, and cUNI on Compound V2 Implemented parameter changes to WETH, WBTC, UNI, LINK on Ethereum Compound V3 USDC On-chain proposal for Arbitrum USDC recommendations Polygon USDC Reward Recommendations Proposed v2 Deprecation Strategy On-chain proposal for risk parameter, IR curve, and Incentive change recommendations for Ethereum Compound v3 ETH |
Daily risk simulations and stress tests. |
| Risk Modeling and Incentive Optimization | Initial parameter recommendations for Compound V3 USDC and WETH Comets on Base Initial parameter recommendations for rETH on Ethereum Compound v3 WETH Weekly market updates for Ethereum USDC, Polygon USDC, Ethereum WETH, Arbitrum USDC |
Risk modeling to provide insight into new market launches for Compound as well as protocol-wide initiatives. Data-driven incentive optimization to help bootstrap liquidity, promote growth and facilitate decentralized governance growth. |
| Feature Upgrades | Improved data freshness of the Gauntlet platform and alerts system. |
Gauntlet continuously upgrades its product offering. |
| Risk Alerts | Continued updates from our alerting platform |
Risk monitoring and alerting is part of Gauntlet’s market risk management offfering. |
Upcoming Selected Work
- Gather community feedback and preference on v2 Deprecation Strategy
- Revisit Polygon USDC comet recommendations after the addition of MaticX.
- Continuous monitoring of utilization levels and supply cap usage across all Compound comets
- Continue support of community initiatives and market alerts
We are happy to answer any questions or hear any feedback from the community.