Governance Weekly Recap

Governance Process
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Hi all - duncand from Boardroom here :wave:

Part of our team’s mission is to increase informed participation in governance, and as a project supporting Compound governance we thought it would be useful to provide a weekly recap of recent governance activity in the Compound community. We feel a governance-focused summary will be useful for delegates and voters due to the often rapid pace of governance news and updates. When appropriate we’ll also note a few specific areas for action on timely subjects.

Within our weekly recap, we’ll provide a look back at:

  • Proposals
  • Governance changes
  • Impactful operating suggestions, and
  • Critical governance-related discussions across Discourse, Twitter, and Discord

The first recap will be posted today. We’d love to hear your feedback and any suggestions you have!

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September 9, 2022

Summary

It’s been an eventful few weeks. The big news: Compound III was announced on August 25; the first deployment allows for the borrowing of USDC using ETH, WBTC, LINK, UNI, and COMP as collateral. The unexpected news: there were some difficulties with the Oracle upgrade. The v3 Oracle, which updated the price feed for Compound v2 and which was implemented 12 days ago with the passing of the Compound Oracle Upgrade proposal, contained an error in the code that caused the cETH market to be “temporarily frozen.” The response was fast, as you’ll see in the first two proposals described below.

Proposals

  • “Oracle Update” (119). Once the oracle error was discovered, @GFXlabs quickly proposed reverting the oracle from v3 to v2. This proposal passed and “the cETH v2 markets are fully functional again.” Because of the seven-day governance process, however, there remained a risk that sudden liquidations could occur during this period due to price fluctuations.
  • “Unpause Seize” (121). Before the above proposal succeeded, a proactive proposal was made by @Arr00 (working with OpenZeppelin) to allow for liquidations to be paused “to ensure that any users or downstream protocols have ample time to rebalance their positions once the price feed for cETH is restored.” As written, the proposal was meant to make sure that Compound’s Pause Guardian (which is designed to pause liquidations if certain conditions are met) can be unpaused: “This ensures that a pause action will only last ~23 hours as opposed to the usual 7-day governance process.” Since the Pause Guardian was not triggered the proposal was canceled.
  • “Risk Parameter Updates for 1 Collateral Asset” (118). Gauntlet’s risk parameter update, part of their regular recommendations, was canceled pending a fix to the Oracle.
  • “cETH Risk Mitigation” (122). Among other things, this proposal by @monet-supply sets a borrow cap and updates the interest-rate model in Compound v2 ahead of the Ethereum merge, which “has the potential to cause disruption to ETH lending markets.” The proposal passed with 100% voting in favor.
  • “Risk Parameter Changes for FEI” (123). This proposal by Gauntlet pauses FEI borrowing and sets a high reserve factor (99%) as the “first step in winding down the FEI market,” which will be deprecated due to Tribe DAO’s entering a “terminal state.” The proposal passed with 100% voting in favor.
  • “Initialize Compound III COMP Distribution” (124). Prior to this proposal, COMP distribution — which enables Compound community governance — was provided only for users of Compound v2. This proposal initiates COMP distribution to users of Compound III by re-allocating 14.17% from v2 markets (total distribution has not changed), according to the parameters specified in the proposal. This “empowers users of the new deployment, and encourages the migration of usage from Compound v2.” The proposal passed with 100% voting in favor.

:speaking_head: Meanwhile, Gauntlet is seeking community feedback through two Snapshot votes:

  • The first (which ends on September 9) aims for discussion and consensus on reserve factors in Compound v2.
  • The second (which ends on September 14) seeks consensus on rate-of-change for collateral factors, particularly with respect to “risk-off” liquidations.

In the Forums

On Twitter

In Discord

Developer Community Calls

  • Calls are held every two weeks. A recording of he last one can be found here.

:speaking_head: Join the next call on September 21 (4:30PM GMT), in Discord.

Quick Gov Links: Governance Overview | Governance Docs | Compound on Boardroom

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Week of September 12, 2022

Summary

The Merge was — happily! — successful, with no signs of disturbance to markets on Compound, thanks in large part to careful preparation. In other, big (non governance-related) news, Compound Treasury announced borrowing for institutions.

Proposals

Gauntlet <> Compound Renewal (125): This proposal from Gauntlet seeks to renew their twelve-month engagement with Compound. Gauntlet has been working with Compound in various ways for three years; their current engagement runs through September 27, 2022. Gauntlet describes their role as follows: “continuous market risk management to maximize capital efficiency while minimizing the risk of insolvency and liquidations to create long-term sustainable growth.” New for this engagement: Coverage of the recently initiated Compound III, and a refund model should Gauntlet’s optimizations incur losses.

“Our ultimate goal is to protect the protocol - we stand behind our work and want the community to have confidence in our recommendations.”

:speaking_head: Vote here, beginning tomorrow.

TUSD market update proposal. @Joyce from TrueUSD has submitted for discussion a proposal for adding TUSD as a collateral asset on Compound. TUSD is an ERC-20 that describes itself as “the first independently-verified digital asset redeemable 1-for-1 for US Dollars.”

Results of community feedback on Gauntlet’s two Snapshot polls: 75% voted in favor of increasing reserve factors by 0.025 for USDT and DAI while nearly 100% voted in favor of reducing each collateral asset’s collateral factor by up to 5%.

In the Forums

Post-mortem of the cETH price-feed incident. @cylon from OpenZeppelin (a security advisor for Compound DAO) breaks down what happened and provides suggestions for going forward — which include exploring “how proposal upgrades could be rolled back more quickly for a limited time following an upgrade’s execution without going through 7-day governance.”

Normalizing ETH market post-merge. @pauljlei from Gauntlet initiates discussion on this topic, since proposal 122 mitigated cETH market risk prior to the merge. @monet-supply suggests shifting to a “jump rate” model.

There are some follow-up questions for Questbook’s delegated domain allocation proposal to the Compound Grants program.

On Twitter

@getty_hill wonders whether it’s time to push for Compound Autonomous Proposals again, given how much the DeFi space has changed.

@blockworks_ publishes an op-ed by John Morrow of Gauntlet pointing to their new advisory standard with DAOs (see proposal above): “if you are wrong, you don’t get paid.”

In Discord

Leighton asks “when do we cut all COMP V2 Distribution??? V3 COMP Distribution method is so superior.”

Matto suggests “streamling the [COMP] distribution adjustments dynamically.”

Developer Community Calls

  • Calls are held every two weeks. A recording of he last one can be found here.

:speaking_head: Join the next call on September 21 (4:30PM GMT), in Discord.

Quick Gov Links: Governance Overview | Governance Docs | Compound on Boardroom

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Week of September 19, 2022

Summary

Welcome to the latest governance recap from Boardroom, covering all of last week’s important governance related content. We hope it proves useful to the community.

Proposals

Compound III Supply Caps (127). Noting that WBTC, ETH, and COMP are utilizing most of their supply caps in Compound III — which has been operating for more than a month ”without bugs, losses, or disruptions” — @rleshner writes that “Now is a prudent time to begin carefully raising collateral supply caps, so that the protocol can continue expanding past its trial phase.” The specific increases suggested are outlined in the proposal.

OpenZeppelin Security Partnership - 2022 Q4 Adjustment (126). Last December OpenZeppelin was selected to provide “continuous audit, security advisory, and auditing services” to Compound. Each quarter they submit a proposal to update their service fee, which this round as in the last is a $1m lump-sum payment in COMP.

The Gauntlet <> Compound Renewal (125), summarized in last week’s recap, was passed, and was executed on September 25.

:speaking_head: Vote here!

In the Forums

OpenZeppelin security updates for August & September are detailed here by @cylon. It includes a link to their Q4 compensation proposal, which follows the structure of their Q3 proposal.

Update cComp parameters? @monet-supply suggests that “it may be safe to increase borrowing caps to allow for more utilization and greater cCOMP yields.”

Dune dashboard and educational materials for Compound III. @andrewhong5297 proposes a Dune dashboard “to build out more user-level analysis, as well as a writeup and youtube video explaining the technicals of the protocol (making it more accessible for developers and analysts to understand).” Here’s the poll.

Normalizing ETH market post merge. The discussion continues; Gauntlet “Gauntlet supports >0% borrow rate at 0% utilization.”

Deprecate FEI market. The first part of this proposal was executed on September 10; @OneTrueKirk wonders if it’s time to submit a proposal to execute the second part, which sets the “FEI reserve factor to 100% (which allows for liquidation of outstanding borrows).”

TUSD market update proposal. This was noted in last week’s recap — and discussion continues, with an update from a16z, and a presentation during the community call.

1independence, which aims to “distribute life-changing opportunities to people,” hopes to discuss a partnership with Compound.

Initialize Compound III (USDC on Polygon PoS). @hamzahkhan proposes initializing Compound III on Polygon, an EVM compatible chain, “with USDC as the borrowable asset…[and seeding] the market with 500k USDC.” While there is support expressed in the comments, a few concerns are noted, and a suggestion made to split the proposal into smaller parts so that governance can address each portion adequately.

Investigate market manipulation risk in ZRK and other tokens? Volt Protocol wonders whether we should return to the topic, given the GMX oracle attack.

Developer Community Calls

The last call took place on September 21, and included discussions led by Gauntlet, OpenZeppelin, and the TUSD team. The recording can be found here.

:speaking_head: Join the next call on October 5 (4:30PM GMT), in Discord.

Quick Gov Links: Governance Overview | Governance Docs | Compound on Boardroom

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Week of September 26, 2022

Summary

Quorum seems to have been harder to reach lately. What are the causes?

Proposals

Compound III Supply Caps (128). This proposal did not reach quorum in its first go-round (127); Gauntlet re-published the proposal.

:speaking_head: Vote now, if you haven’t already!

OpenZeppelin Security Partnership - 2022 Q4 Adjustment (126) passed with just about 100% voting in favor and was executed on September 30.

In the Forums

Risk Parameter Updates for the week. Gauntlet recommended no changes to the parameters. See the post for a full presentation and analysis.

Deprecate FEI market. Is it time for the next stage, which would set the reserve factor to 99% or 100%?

Add New Zealand dollar stablecoin NZDS to Compound?

Add market: 1INCH has gotten some support.

On Twitter

Follow Compound Governance, a new account that posts all proposals and governance updates.

Gauntlet celebrates the passing of the “Gauntlet <> Compound Renewal” proposal, breaks down the voting, and reminds us of their new “insolvency refund.” “Contributors need to be accountable to the DAOs they serve.”

In Discord

Reaching quorum has been a challenge lately. Should “abstain” votes be counted towards quorum?

A reminder that your COMP needs to be delegated to an address (your own or a delegate’s) in order to have voting power.

Is deploying the new implementation of cUSDCv3 “scary”?

Developer Community Calls

:speaking_head: Join the next call on October 5 (4:30PM GMT), in Discord. (A recording of the last one can be found here.)

Quick Gov Links: Governance Overview | Governance Docs | Compound Governance on Twitter | Governance Feed in Discord | Compound on Boardroom

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Week of October 3, 2022

Summary

See below for important details about the next iteration of the Compound Grants Program, and read the latest “Compound Digest,” a monthly newsletter “highlighting the best of the Compound ecosystem.”

Proposals

Risk Parameter Changes for FEI: Part 2 (129). This proposal pauses cFEI minting and sets the reserve factor to 100%. It follows from a previous proposal, and is discussed fully here.

Compound III Supply Caps (128). This proposal succeeded with nearly 100% voting “For,” and was executed on October 7.

Proposal To Improve Governance Discussion and voting processes with Commonwealth. This proposal on Snapshot, initiated by Blockchain at Berkeley based on the thread started by @commonwealth.im, received nearly 100% support in favor of migrating from Discourse to Commonwealth.

In the Forums

The next iteration of the Compound Grants Program is still forming, led by @harsha and Questbook. There’s an update identifying domains and domain allocators, as well as one concerning legal compliance.

Update cCOMP Parameters (Borrow Cap and Interest Rate Model). This proposal, put forward by @monet-supply, could move on-chain soon, pending some research by Gauntlet.

Liquidation event handling in Compound III: The absorb function is missing an event log when a liquidated user is left with a positive account balance. @jared says that adding an event log “will improve the user experience on Etherscan and blockchain explorers, and make analytics easier.”

On Twitter

Interested in earning “up to 2 years worth of Compound lending fees, instantly and upfront — all in one ethereum transaction”? asks @ZacharyDash from Flashstake.

In Discord

Check in on the #governance-feed channel to track proposal progress.

Developer Community Calls

Calls are held every two weeks. Here’s a recording of the last one from October 5, which included discussions led by Gauntlet, Open Zeppelin, Questbook, DeFi Saver, and Adrastia.

:speaking_head: Join the next call on October 19 (4:30PM GMT), in Discord.

Quick Gov Links: Governance Overview | Governance Docs | Compound on Boardroom

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Week of October 10, 2022

Summary

We may have a few proposals forthcoming; see forum discussions noted below. This Wednesday’s community call should also be interesting, with participants from Gauntlet, Open Zeppelin, and Compound Labs, among others. But as @adam reminds us, “this call belongs to the community, and as a community member you are empowered to take this call in any direction you think best benefits the community.”

Proposals

Risk Parameter Changes for FEI: Part 2 (129) succeeded with nearly 100% voting “for,” and was executed on October 16.

In the Forums

Adjust stablecoin rate parameters? @monet-supply points out that stablecoin interest rate models haven’t changed much since the introduction of Compound v2, and proposes updating the rate parameters.

On-chain credit scores. @ccb from RociFi suggests using their credit score model to increase Compound’s capital efficiency.

Risk parameter udpates. @pauljlei, on behalf of Gauntlet, recommends “no changes to Compound II’s current parameterization” for the week.

Market manipulation risk. After the recent Mango markets manipulation @monet-supply is working on a proposal to address this — and help reduce risk to Compound. @OneTrueKirk has some ideas, and Gauntlet is running analyses.

cComp paremeters. After further discussion, a proposal may be forthcoming that adjusts the cComp borrow cap only.

BiLira (TRYB) stablecoin. @BiLira may be submitting a proposal to on-board TRYB, “the only and 1:1 Turkish Lira-backed stablecoin,” on Compound III as a borrowable asset only (i.e. not as a collateral asset).

On Twitter

Can credit models work in DeFi?

Senator Hickenlooper writes to Gary Gensler about establishing rules for Crypto.

In Discord

Interesting, active discussion about changing the cComp parameters (see above).

Compound governance is “relatively unique in that proposals are the code changes being voted on.”

Developer Community Calls

  • Calls are held every two weeks. A recording of he last one can be found here.

:speaking_head: Join the next call on October 19 (4:30PM GMT), in Discord. See the agenda.

Quick Gov Links: Governance Overview | Governance Docs | Compound on Boardroom

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Week of October 17, 2022

Summary

A couple of important proposals were put forward this week, and there’s a discussion happening now about creating another governance structure: Compound Improvement Proposals. See the highlighted note below.

Proposals

Pause Supply for Compound Assets (131). This proposal, presented “out of an abundance of caution,” hopes to mitigate any Mango-Markets style attacks on Compound v2 by pausing the supply for ZRX, BAT, MKR, and YFI assets. The proposal looks set to pass with nearly 100% voting “for.”

Adjust cCOMP and cUNI Parameters (130). The v2 cComp market has recently seen very high utilization — reaching the COMP borrow cap. Changing the borrow cap from 90,750 to 150,000 COMP and switching the rate model to the one used by cUNI, as this proposal suggests, should help the market attain “a more suitable equilibrium.” The proposal passed with nearly 100% voting “for” and is now queued for execution.

In the Forums

:sparkles:Compound Improvement Proposals. @cylon from Open Zeppelin puts forward “a foundational CIP-1 to define the process for CIPs and the role they can play in the Compound ecosystem going forward.”

:speaking_head: Join the community call to discuss this: October 26, 9:30AM PST / 12:30PM EST / 4:30PM GMT

TUSD doesn’t have a fallback oracle specified? Is that ok? asks @devenmatthews.

Another patch: @jared describes how another opportunity for improvement to the protocol was discovered while implementing a patch to fix liquidation event handling.

Delegate platform updates have been posted by FranklinDAO (@pennblockchain).

On Twitter

Bitcoin and Ether are both worth less than they were ~5 years ago. “Keep thinking about it” says @rleshner.

Developer Community Calls

  • Calls are held every two weeks. Here’s a recording of the last one from October 19.

:speaking_head: Join the next call on November 2 (4:30PM GMT), in Discord.

Quick Gov Links: Governance Overview | Governance Docs | Compound on Boardroom

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Week of October 24, 2022

Summary

There’s a new governance process for Compound being proposed: Compound Improvement Proposals. The inaugural CIP-1 is available for review, and another discussion is scheduled for Wednesday.

Proposals

Risk Parameter Updates 2022-10-26 (133). Gauntlet proposes one parameter change for one asset (SUSHI) on V2. See the presentation here.

Liquidation Event Handling and Collateral Reserves (132) passed with nearly 100% voting “for” and was executed on October 31.

Adjust cCOMP and cUNI Parameters (130) was executed on October 24.

Pause Supply for Compound Assets (131) was executed on October 26.

In the Forums

:sparkles:Compound Improvement Proposals. @cylon from OpenZeppelin has made updates and revisions to CIP-1: Check out the doc here.

:speaking_head: Join the community call to discuss this: Wednesday, November 2, 9:30AM PST / 12:30PM EST / 4:30PM GMT

Initialize Compound III (WETH on Ethereum). “With the Compound III codebase having proven itself thus far,” @jared writes, it’s time to consider launching a second market. Gauntlet is analyzing.

TUSD’s fallback oracle. @CL_Michael helpfully answers questions about this.

On Twitter

All tweets will be AI generated from now on, unless otherwise stated, says @rleshner.

In Discord

There’s no Snapshot for Compound — yet. If approved, the new CIP process might change that.

Developer Community Calls

  • Calls are held every two weeks, on Wednesdays. A recording of he last one can be found here.

:speaking_head: Join the next call on November 2 (4:30PM GMT), in Discord.

Quick Gov Links: Governance Overview | Governance Docs | Compound on Boardroom

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Week of October 31, 2022

Summary

CIP-1 is following its own proposed process and is now in the fourteen-day “final call” stage before it will go to Snapshot for a vote. Here’s @cylon’s latest update, follow the discussion. And check out the latest draft of CIP-1, if you haven’t already.

Proposals

Risk Parameter Updates for One Collateral Asset (133) passed with over 90% voting “for” and was executed on November 6.

In the Forums

Compound grants. @harsha provides an update on Questbook’s delegated domain allocation: it looks like a proposal is in the works for next week.

Initialize Compound III (WETH on Ethereum). Discussion continues, specifically about the Chainlink/Coinbase price feed.

SUSHI risk. The parameter update proposed by Gauntlet (which passed) was in part due to observation of specific SUSHI supplier; that supplier has since decreased their borrowing.

On Twitter

Compound Thesis featured Gauntlet’s Tarun Chitra.

In Discord

More SUSHI. Maybe we should enable it in Compound III, with appropriate parameters in place, and wind down SUSHI on v2?

Developer Community Calls

  • Calls are held every two weeks. Here’s a recording of the last one.

:speaking_head: Join the next call on November 16 (16:30PM UTC), in Discord.

Quick Gov Links: Governance Overview | Governance Docs | Compound on Boardroom

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Week of November 7, 2022

Summary

A reminder that CIP-1 is likely to go up for voting this week, on Snapshot. But keep your eye on this thread for any updates and adjustments.

It’s a good time to be involved with governance in DeFi.

Proposals

None active at the moment.

In the Forums

Market downturn. Gauntlet’s @pauljlei provides analyses: “no new insolvencies” as of November 10.

Risk parameter updates. Gauntlet recommends no updates this week, “given current market volatility.”

SUSHI supplier: @ccb from RociFi presents more analysis of a specific supplier / borrower, assigning a credit score.

On Twitter

Post-FTX sentiment check, from @rleshner.

In Discord

How long does it take for a proposal to go from “pending” to “active”?

Subscribe to #governance-feed to be notified when proposals are created.

Developer Community Calls.

:speaking_head: Join the next call on November 16 (4:30PM GMT), in Discord.

Quick Gov Links: Governance Overview | Governance Docs | Compound on Boardroom

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Week of November 14, 2022

Summary

CIP-1 is live on Snapshot — check it out if you haven’t already.

Proposals

CIP-1. This inaugural Compound Improvement Proposal “describes standards, processes, and enhancements intended to improve the Compound Protocol.” The new CIP process is designed to be the new default mechanism to “improve Compound.” Among other things, it increases access to Compound governance by removing the requirement of holding 25k COMP to make a proposal: anyone from the community can use it to suggest improvements, develop opportunities to contribute, or request funding.

:speaking_head: Read more and vote here.

In the Forums

Compound Grants 2.0. Questbook’s proposal will be live on November 28. (Note that several grants have come forward in the forums already.)

Delegate platform update from @pennblockchain.

Year-in-review. OpenZeppelin looks back on their security partnership — and then considers what lies ahead.

How to encourage wETH supply on Compound III? Gauntlet asks, and presents three options.

Developer Community Calls

:speaking_head: Join the next call on November 30 (4:30PM GMT), in Discord. Here’s a recording of last week’s call.

Quick Gov Links: Governance Overview | Governance Docs | Compound on Boardroom

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Week of November 21, 2022

Summary

The initiating Compound Improvement Proposal (CIP-1) passed, with nearly 100% (or 827 wallets) voting in favor. @cylon will be setting up the new CIP repo soon.

Proposals

Borrow Caps for Compound V2 Assets (135). This proposal seeks to adjust borrow caps on 10 Compound V2 assets, including COMP, LINK, UNI, and WBTC. There’s a good discussion with Gauntlet about it here.

In the Forums

Compound III — WETH on Ethereum. Gauntlet has provided an initial analysis.

Compound grants 2.0. As the program takes steps forward, @VonNeumann2022 asks a few questions — which are answered.

On Twitter

There’s a Compound governance account, in case you didn’t know.

In Discord

Any interest in more extensive delegate dashboards?

Developer Community Calls

:speaking_head: Join the next call on November 30 (4:30PM GMT), in Discord.

Quick Gov Links: Governance Overview | Governance Docs | Compound on Boardroom

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Hi there, I’m new here…I just have a question to be eligibe for any airdrop and also for vote can I kee my COMP tokens on BSC too or only on ETH? Also need to be staked? Thank you in advance.

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Week of November 28, 2022

Summary

Compound Grants 2.0 is officially going forward — which is great news. Otherwise it’s been another week of several discussions and actions related to risk.

Proposals

Increase WETH Supply Cap in cUSDv3 (137). Because the WETH supply cap has been reached in cUSDCv3, this proposal aimed to double the cap to 150,000. It passed on December 5 with 100% voting “For” and is queued for execution.

CGP 2.0 by Questbook (136). This proposal — which revives and restructures the Compound Grants program — passed with nearly 100% voting “For” and was executed on December 4.

Borrow Caps for V2 Assets (135). This proposal passed with nearly 100% voting “For,” and was executed on November 30.

In the Forums

Protocol maintenance. @rleshner lists some overlooked items in v2.

Risk Council. @VonNeumann2022 suggests creating one to more quickly be able to make (limited) risk-parameter changes. Aave is considering something similar.

Risk parameter updates have been posted by Gauntlet, suggesting the adjustment of one parameter for one asset (COMP) in V3.

GitHub repository for Compound Improvement Proposals — @cylon has created the initial setup.

Delegate platform update from FranklinDAO (@pennblockchain).

Community multisig. @arr00 announces that Compound Labs has stepped down from the multsig and will be replaced by Gauntlet.

On Twitter

Vitalik on governance rights and token value.

Happy birthday beacon chain!

In Discord

What makes a CIP? There’s some discussion here.

Developer Community Calls

A recording of last week’s call can be found here.

:speaking_head: Join the next call on December 14 (16:30PM UTC), in Discord.

Quick Gov Links: Governance Overview | Governance Docs | Compound on Boardroom

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Week of December 5, 2022

Summary

There are two proposals up for voting, and a few brewing in the forums. Also, @jayson introduced Compound Extensions this week — a new feature for “optional add-ons, built by community developers, that enhance the Compound experience.” And the latest Compound Digest is out.

There’s a Compound Developer Community Call coming up on Wednesday — see details below.

Proposals

OpenZeppelin Security Partnership - 2023 Q1 Compensation (139). OpenZeppelin proposes that their security partnership with Compound be renewed on the same terms, but on a quarterly basis.

Reserve Maintenance (138). This proposal comprises “a series of minor maintenance actions from the list of Protocol Maintenance Tasks, to withdraw the reserves of deprecated markets and residual cToken balances to the governance-controlled Timelock, and migrate deprecated assets (SAI and REP).”

In the Forums

Compound V2’s oracle. @CL_Michael from Chainlink proposes to upgrade the oracle to UAV3, with one main change from the last proposal.

Compound V3 risk dashboard. @pauljlei announces Gauntlet’s new dashboard, which will “help the community understand our methodology and recommendations…. [and] communicate how these recommendations mitigate risk and increase capital efficiency for the protocol.”

Increase UNI supply cap. Gauntlet recommends increasing UNI’s supply cap in the USDC comet market to 2.3m, to support “organic growth” without creating “outsized market risk.”

V2 risk parameter updates. Gauntlet advises no changes this week.

On Twitter

A thread on Compound Extensions.

Understanding lending protocol market risk, a thread by Gauntlet hitting the points in their Medium post.

Developer Community Calls

:speaking_head: Join the next call on December 14 (17:30PM UTC), in Discord.

Quick Gov Links: Governance Overview | Governance Docs | Compound on Boardroom

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Week of December 12, 2022

Summary

Three proposals have passed as we head into the holiday season. It’s been a time of very positive developments for Compound.

The next Community Call (see below) won’t be until January 11, 2023.

Proposals

Risk Parameter Updates for USDC Comet Market (140). This proposal to increase the supply cap for UNI on the USDC comet market (from 1.25m to 2.3m) and to decrease the COMP liquidation factor on the same market (from 93% to 88%) passed with nearly 100% voting “For” and was executed on December 19.

OpenZeppelin Security Partnership - 2023 Q1 Compensation (139). This proposal passed with 100% voting “For” and was executed on December 17.

Reserve Maintenance (138). This proposal passed with nearly 100% voting “For” and was executed on December 16.

In the Forums

Compound DSR proposal. @MakerGrowth informs us that Maker has recently reactivated the DAI Savings Rate (1% variable yield) and proposes “the reactivation of the DSR in Compound so users can have direct access to this low risk base DeFi yield.”

LINK borrow cap. @pauljlei alerts us that LINK is reaching its borrow cap on Compound v2. Gauntlet will soon follow up with recommendations.

Compound extensions. Discussion continues about this exciting development.

On Twitter

Compound audit highlights from OpenZeppelin.

In Discord

Compound Grants v2 planning to go live in mid January 2023, according to Questbook.

Developer Community Calls

:speaking_head: The next call will be on January 11, 2023 (4:30PM GMT), in Discord. A recording of last week’s call can be found here.

Quick Gov Links: Governance Overview | Governance Docs | Compound on Boardroom

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