November 29, 2022

Block by Block: Assessing The Risk In DeFi Protocols

31 minutes

The last 2 months of the cryptocurrency industry has been filled with DeFi Hacks, Crypto exchange collapses and industry wide fear, uncertainty and doubt.But what if some of that uncertainty could have been proactively identified and some of the risks mitigated?

In this episode, Ian Andrews (Chief Marketing Officer, Chainalysis) sat down with Nick Cannon (VP of Growth at Gauntlet). They talk about Gauntlet’s financial modelling platform that uses techniques from the algorithmic trading industry to improve DeFi protocol risk management.

Nick shares how Gauntlet has helped DeFI pioneer, Aave improve protocol revenue without taking on additional risk and how they were early to recommend customers not accept tokens like Terra’s UST and FTX’s FTT tokens.

Minute-by-minute episode breakdown

(2:45) – What is Gauntlet Network and how do they support the DeFi ecosystem

(8:39) – Using historical data to determine liquidation risks for projects

(11:01) Taking into a DeFi protocols risk appetite when creating a risk assessment and exposing vulnerabilities

(16:05) – How the transparency of DeFi protocols helps protect against major crypto collapses like FTX and Three Arrows Capital

(18:51) –Unraveling the Mango Market vulnerability and how Gauntlet assess the DeFi protocol’s risk

(22:55) - Analyzing Token Quality when creating holistic risk assessments on the Gauntlet Platform

(24:46) - Why Proof of Reserves may not tell the whole story and how we can improve the crypto exchange audit process

Related resources

Check out more resources provided by Chainalysis that perfectly complement this episode of the Public Key.

Blog: Post FTX Market Updates

Blog: Impact Measurement: Aave - A Case Study

Medium:Gauntlet Blog Website

Website: Gauntlet uses battle-tested techniques to inform on-chain protocol management.

Blog: Chainalysis Storyline is Here: Transparency and Clarity for Web3

Webinar: Intro to Storyline: A Two-Part Series: Understand, Investigate, Communicate DeFi Transactions

Website: Aera: The world’s first autonomous, data-driven treasury management protocol.

Twitter: Chainalysis Official Twitter Page: Building trust in blockchains

Speakers on today’s episode

Ian Andrews * Host * (Chief Marketing Officer, Chainalysis) https://www.linkedin.com/in/ianhandrews

Nick Cannon (VP of Growth, Gauntlet) https://twitter.com/inkymaze

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