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#25
Gauntlet Risk Parameter Recommendation (5/26/2022)
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Gauntlet makes the following recommendations to optimize risk and capital efficiency for Karura:

Karura Recommendations:

  • We recommend increasing LKSM’s liquidation ratio from 1.6 to 1.65.

Rationale:

Since last week, VaR has decreased from $2.3M to $827k. KAR’s VaR has decreased from $1.2M to $0, while LKSM’s VaR has decreased from $1.1M to $827k. KSM’s VaR remained at $0. All of the remaining insolvency risk is concentrated in LKSM, and our simulations indicate that increasing the LKSM liquidation ratio can further mitigate that risk with an acceptable tradeoff in capital efficiency.

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
25
Threshold
2
Hash
0xdfd18384c2399c67062924b53eae46c10415813c793a86096be9ee7fb141a7a7
Call
Table
Json
callIndex0x6802
sectioncdpEngine
methodsetCollateralParams
args
currencyId
tokenLKSM
interestRatePerSecNoChange
liquidationRatio
newValue1650000000000000000
liquidationPenaltyNoChange
requiredCollateralRatioNoChange
maximumTotalDebitValueNaN
TimelineLatest activity undefined
2022-06-01 10:03:30
Proposed
setCollateralParams
2/2
Aye(2)
Nay(0)
2022-06-01 10:05:00
Vote
2022-06-01 10:05:42
Vote
2022-06-01 10:06:18
Closed
2022-06-01 10:06:18
Approved
2022-06-01 10:06:18
Executed
Result
Succeed
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