Risk Parameter Updates for Aave V3 AVAX 2022-11-23

Summary

A proposal to make parameter changes on Aave V3 AVAX.

Motivation

We recommend the following borrow caps for the Aave V3 AVAX Market. Borrow caps help prevent against high-risk attack vectors while sacrificing little capital efficiency. Our simulation analyses show that these borrow caps for these assets reduce the likelihood of market manipulation while allowing for natural organic borrow demand. As these markets naturally grow, we can continue to reassess raising caps incrementally.

• FRAX borrow_cap: 2,000,000
• MAI borrow_cap: 2,000,000
• LINK borrow_cap: 220,000

Specification

Set borrow caps on FRAX, MAI, and LINK on Aave V3 AVAX.

Copyright

Copyright and related rights waived via CC0.

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