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#21
Gauntlet Risk Parameter Recommendation: Lower KSM Collateral Ratio
5mos ago
Executed

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

Karura Recommendations:

  • We recommend lowering the minimum collateral ratio for KSM from 1.65 to 1.6.

Rationale: Since our last recommendations, Value at Risk (VaR) has remained at $1.7M. KAR’s VaR fell from $272k to $233k, while LKSM’s VaR rose from $1.4M to $1.5M. KSM’s VaR remains close to $0 despite having lowered its liquidation ratio twice last month. We recommend lowering the KSM collateral ratio so that users can mint more KSM-backed aUSD, which our simulations show has a low likelihood of increasing insolvency potential.

Dashboard:

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

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Metadata
Proposer
Index
21
Threshold
2
Hash
0x4627fc52da32b2e60904bfa5b390db12490d7ca00b1a3ddbf7b697d784ee09b3
Call
Table
Json
callIndex0x6803
sectioncdpEngine
methodsetCollateralParams
args
currencyId
tokenKSM
interestRatePerSecNoChange
liquidationRatioNoChange
liquidationPenaltyNoChange
requiredCollateralRatio
newValue1600000000000000000
maximumTotalDebitValueNaN
TimelineLatest activity 5mos ago
2022-04-11 05:20:06
Proposed
setCollateralParams
2/2
Aye(2)
Nay(0)
2022-04-11 05:26:06
Vote
2022-04-11 05:31:00
Vote
2022-04-11 05:31:24
Closed
2022-04-11 05:31:24
Approved
2022-04-11 05:31:24
Executed
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