[ARC]: Unfreeze Ampleforth for AAVE V2 ETH Market

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The discussion focused on a proposal to unfreeze the Ampleforth lending/borrowing pool on AAVE, potentially driven by the launch of SPOT and the potential for more positive rebase cycles. However, concerns about risks, including price manipulation attacks and bad debt, led to a conclusion that the pool should remain frozen, with the possibility of considering Ampleforth for the upcoming AAVE V3 platform.

The discussion primarily revolved around the proposal by RomanPope to unfreeze the Ampleforth lending/borrowing pool on the AAVE platform1. Ampleforth, a unique cryptocurrency that uses a rebasing mechanism to adjust its supply, has previously contributed significantly to AAVE's revenue during positive rebase cycles. The recent launch of SPOT, a decentralized inflation-resistant token, could potentially drive further demand for Ampleforth, leading to additional positive rebase cycles and increased utilization of the Ampleforth pool on AAVE.

However, the proposal sparked a debate on the risks associated with such a move. 0xGraham suggested that the discussion should be moved to a thread focused on the upcoming launch of AAVE V3, and that Ampleforth should be considered as an asset for V32. Eele and Sakulstra discussed the potential risks, with Sakulstra highlighting the possibility of price manipulation attacks and the protocol being left with bad debt6. Eele agreed that low-liquidity assets like AMPL may be vulnerable to such attacks, suggesting that it might be best to keep AMPL frozen for now7.

The discussion concluded with MarcZeller from the ACI stating that they are not supportive of the proposal, mentioning that v2 is legacy tech and suggesting that Ampleforth could be a candidate to join v3 after its deployment8. This suggests that while there is interest in unfreezing the Ampleforth pool, the community is cautious about the potential risks and is considering other options such as the upcoming AAVE V3 platform.

Posted a year ago

Last reply a year ago

Summary updated 2 months ago

Last updated 08/12 04:39