The discussion primarily revolved around the modification of the liquidation bonus on one Aave V3 AVAX asset and two Aave V3 Optimism assets. Pauljlei, using Gauntlet's risk simulation platform, proposed these changes as a means to balance insolvencies, liquidations, and borrow usage without adding significant market risk. The community has agreed on a Risk Off Framework for lowering liquidation thresholds¹.

For the Aave V3 AVAX asset, Gauntlet's simulations suggest that the protocol can lower the liquidation bonus for WAVAX on Avalanche Aave v3 without incurring significant additional risk. The current liquidation bonus is 10.0%, and the recommended value is 9.2%¹. Similarly, for the Aave V3 Optimism assets, the balance of risk and capital efficiency can be improved by lowering the liquidation bonus for WBTC and raising the liquidation bonus for sUSD on Optimism Aave v3. The current liquidation bonus for WBTC is 10.0%, with a recommended value of 9.4%. For sUSD, the current liquidation bonus is 5.0%, with a recommended value of 5.4%¹.

The community was informed about the initiation of a Snapshot vote for the V3 AVAX recommendations targeted for Tuesday, 2/21/2023, and a Snapshot vote for the V3 OP recommendations¹. Pauljlei announced the V3 Optimism Snapshot vote and provided a link for users to access it². He also published the AVAX V3 Snapshot Vote and the OP V3 AIP, both of which were set to begin on Wednesday, 2/22/2023 ^3,4. However, he later clarified that the proposed AVAX changes had not been implemented yet and due to recent market events, the urgency of these changes was being reconsidered⁵.

In conclusion, the discussion focused on the proposed changes to the liquidation bonus for certain Aave V3 assets. The community was actively involved in the decision-making process, with Snapshot votes scheduled to decide on the proposed changes. However, due to recent market events, the implementation of the proposed AVAX changes is currently under reconsideration.