Compound

Background

For the past three years, Gauntlet has worked with Compound to maximize the protocol’s capital efficiency given an acceptable level of market risk.

Full details of the proposal can be found here.

Proposal

A proposal to renew Gauntlet’s 12-month engagement with Compound on continuous market risk management to maximize capital efficiency while minimizing the risk of insolvency and liquidations to create long-term sustainable growth.

Gauntlet’s Risk Management platform quantifies risk, optimizes risk parameters, runs economic stress tests, and calibrates parameters dynamically. Gauntlet uses agent-based simulation models tuned to actual market data to model tail market events and interactions between different users within DeFi protocols. The proposal includes continued support for Compound II, as well as support for Compound III.

The service fee structure will be the same as the previous year’s engagement and calculated quarterly per the following formula: log(Number of Assets, 10) * Total Borrow * Marginal Base Fee tier bps / 4.

To increase its alignment with Compound, Gauntlet will refund a portion of the payment should Gauntlet’s risk parameter optimizations incur losses for the protocol during the engagement. For more details, see the full proposal.

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.