![]() What Gauntlet does instead is study historical data on liquidity and volatility to single out the riskiest collateral type, then assessing the risk of a system when stablecoins are borrowed against this collateral asset. ![]() Risks with smart contracts underpinning a DeFi protocol are best assessed by smart contract auditors, the firm says. Gauntlet looks at five main factors to determine the final score, including user behaviour, collateral volatility, relative collateral liquidity, protocol parameters and smart contract risk, although the firm notes that their focus is on the first four factors. The higher the grade, the safer the protocol in question is for investors or depositors as the risk of them making losses is incredibly low.Ĭurrently, DeFi Pulse has tested this new feature on major DeFi protocols Aave (LEND, AAVE) and Compound Finance (COMP), which have obtained 95% and 91% respectively on their safety grades. The DeFi Pulse Economic Safety Grade, developed in collaboration with blockchain protocol security specialist Gauntlet Network, assesses the insolvency risks of DeFi projects via Gauntlet’s live simulation platform and certifies each project with a percentage grade. The DeFi equivalent to CoinMarketCap and CoinGecko, DeFi Pulse provides crucial data pertaining to both old and new DeFi projects, and in a bid to strengthen its ecosystem, the platform has introduced benchmark guidelines that determine the risk level of any DeFi project. Leading DeFi data aggregation platform DeFi Pulse is the crypto community’s go-to source for project statistics.
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