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#4
Gauntlet Risk Parameter Recommendation (6/9/2022)
3mos ago
Executed

Gauntlet makes the following recommendations to optimize risk and capital efficiency for Acala and Karura:

Recommendations:

  • We recommend increasing LKSM’s liquidation ratio from 1.7 to 1.75.
  • We recommend increasing LKSM’s minimum collateral ratio from 2.1 to 2.2.
  • We recommend increasing LCDOT’s liquidation ratio from 2.3 to 2.35.
  • We recommend decreasing KAR’s liquidation ratio from 1.55 to 1.5.
  • We recommend decreasing DOT’s liquidation ratio from 1.55 to 1.5.
  • We recommend decreasing LDOT’s liquidation ratio from 2.25 to 2.2.
  • We recommend decreasing LDOT’s minimum collateral ratio from 3.0 to 2.8.
  • We recommend decreasing ACA’s liquidation ratio from 1.95 to 1.9.

Rationale:

Since our last recommendations, VaR has increased from $694k to $1.02M. All of the VaR comes from two assets: LKSM and LCDOT. LKSM’s VaR has decreased from $565k to $541k. LCDOT’s VaR has increased from $98k to $479k. The other assets (KSM, KAR, DOT, LDOT, ACA) all currently have VaR of $0.

KAR, DOT, LDOT, and ACA are all relatively safe from a market risk perspective, so can have their liquidation ratios gradually lowered to improve capital efficiency. LKSM and LCDOT remain risky, so we recommend continuing to increase their liquidation thresholds to further reduce insolvency risk. KSM optimally balances insolvency risk against capital efficiency at its current parameters.

Dashboard:

The community should use Gauntlet’s Risk Dashboard to understand better the updated parameter suggestions and general market risk in Acala.

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.

Edited
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Metadata
Proposer
Index
4
Threshold
2
Hash
0x9f45805bcd852d41062ea33136b41fb2c9b2c91a2f57983998e462e39e03c8f9
Call
Table
Json
callIndex0x0300
sectionutility
methodbatch
args
calls
0
callIndex0x6802
sectioncdpEngine
methodsetCollateralParams
args
currencyId
liquidCrowdloan13
interestRatePerSecNoChange
liquidationRatio
newValue2350000000000000000
liquidationPenaltyNoChange
requiredCollateralRatioNoChange
maximumTotalDebitValueNaN
1
callIndex0x6802
sectioncdpEngine
methodsetCollateralParams
args
currencyId
tokenDOT
interestRatePerSecNoChange
liquidationRatio
newValue1500000000000000000
liquidationPenaltyNoChange
requiredCollateralRatioNoChange
maximumTotalDebitValueNaN
2
callIndex0x6802
sectioncdpEngine
methodsetCollateralParams
args
currencyId
tokenLDOT
interestRatePerSecNoChange
liquidationRatio
newValue2200000000000000000
liquidationPenaltyNoChange
requiredCollateralRatio
newValue2800000000000000000
maximumTotalDebitValueNaN
3
callIndex0x6802
sectioncdpEngine
methodsetCollateralParams
args
currencyId
tokenACA
interestRatePerSecNoChange
liquidationRatio
newValue1900000000000000000
liquidationPenaltyNoChange
requiredCollateralRatioNoChange
maximumTotalDebitValueNaN
TimelineLatest activity 3mos ago
2022-06-13 05:18:18
Proposed
2/2
Aye(2)
Nay(0)
2022-06-13 05:30:42
Vote
2022-06-13 05:37:54
Vote
2022-06-13 05:38:18
Closed
2022-06-13 05:38:18
Approved
2022-06-13 05:38:18
Executed
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