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#10
Gauntlet Risk Parameter Recommendation (7/27/2022)
2mos ago
Executed

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

Recommendations:

  • We recommend decreasing the ACA liquidation ratio from 1.7 to 1.65.
  • We recommend decreasing the ACA minimum collateral ratio from 2.05 to 2.0.
  • We recommend decreasing the DOT minimum collateral ratio from 1.7 to 1.6.
  • We recommend increasing the KSM liquidation ratio from 1.5 to 1.55.
  • We recommend increasing the KSM minimum collateral ratio from 1.8 to 1.9.

Rationale:
The VaR is $1.7M, and our recommendations will leave it unchanged. KAR has a VaR of $3k. LCDOT has a VaR of $575k. LDOT has a VaR of $343k. LKSM has a VaR of $810k. ACA, DOT, and KSM each have a VaR of $0.

ACA is relatively safe from a market risk perspective, so can have its liquidation ratio gradually lowered to improve capital efficiency. KSM is relatively riskier, so we recommend increasing its liquidation ratio to reduce insolvency risk. DOT, KAR, LCDOT, LDOT, and LKSM’s liquidation ratios are currently at an optimal balance of risk and capital efficiency.

Potential Forced Liquidations:
Whenever we raise liquidation ratios, there’s a chance that some users may immediately become liquidatable as a result. However, as of our most recent data, the lowest KSM collateral ratio is 1.78, so no accounts would be immediately liquidated at today’s prices.

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
10
Threshold
2
Hash
0xb4396b415718bb09c2ad434b98c6385ca366964aacec0f505eb3bf4e0d78db0b
Call
Table
Json
callIndex0x0300
sectionutility
methodbatch
args
calls
0
callIndex0x6802
sectioncdpEngine
methodsetCollateralParams
args
currencyId
tokenACA
interestRatePerSecNoChange
liquidationRatio
newValue1650000000000000000
liquidationPenaltyNoChange
requiredCollateralRatio
newValue2000000000000000000
maximumTotalDebitValueNaN
1
callIndex0x6802
sectioncdpEngine
methodsetCollateralParams
args
currencyId
tokenDOT
interestRatePerSecNoChange
liquidationRatioNoChange
liquidationPenaltyNoChange
requiredCollateralRatio
newValue1600000000000000000
maximumTotalDebitValueNaN
TimelineLatest activity 2mos ago
2022-08-01 03:46:18
Proposed
2/2
Aye(2)
Nay(0)
2022-08-01 03:48:54
Vote
2022-08-01 06:30:18
Vote
2022-08-01 06:30:54
Closed
2022-08-01 06:30:54
Approved
2022-08-01 06:30:54
Executed
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