Methodology: New Asset Listings

Methodology Scope

The parameter recommendations for the initial listing and collateral enablement process differ based on the following:

• Stage of maturity and usage of the protocol
• Liquidity on local DEXes and other chains
• Asset types (ex., staking derivatives, stablecoins, bridge assets, etc.)
• Protocol risk mechanism options (ex. supply caps vs. no supply caps)

Methodology Objective

Gauntlet aims to provide a standard framework for assessing market risk when listing assets and enabling assets as collateral. Managing collateral listings is essential to the growth of the protocol.

Throughout the asset listing and collateral enablement processes, Gauntlet’s goal is to ensure that insolvency and liquidity risks are minimal and that when liquidations occur, they can be done healthily by incentivized liquidators.

Methodology Summary

New asset listings are based on heuristics rather than simulation. When no historical data exists for a proposed asset on the protocol, Gauntlet does not do simulations based on artificial data. As such, our heuristic recommendations lean on the conservative side upon initial listing. Once real data is available to analyze and tune parameters accordingly, we may favor adjustments toward more aggressive parameter settings.

We use the most recent similar asset listed on the same or similar protocol as direct references for the new asset listing recommendations. In doing so, we retain our conservative heuristic approach while also considering how the previously listed asset’s initial recommendations held up after listing. If similar previous listings were later adjusted to reduce risk, we may conclude that current listing parameters for a comparable asset should be more conservative.

Methodology Assumptions

Assumes that the reference assets are comparable enough to adequately assess risk.

Success Metrics

Retroactive analyses of initial asset recommendations and how they are subsequently tuned.