Aave - Asset Management Guidelines

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The Aave community is discussing strategic management of its treasury, with key contributors proposing a living document for asset allocation, risk management, and action plans during market disruptions. The debate includes maintaining concentration in the AAVE token versus diversification, and the need for active management, with the community now reviewing these proposals.

The Aave community has been engaged in a detailed discussion about the strategic management of the Aave treasury. Key contributors MatthewGraham, AcceleratedCapital, Ahuja, and Gmoney proposed a living document to guide asset allocation, establish accountability, and provide a course of action during market disruptions1. The Aave Treasury Management Committee (TMC) is suggested to meet quarterly to review these guidelines and propose changes, with regular reporting to keep the community informed1.

The investment assets of the Aave Treasury aim to preserve capital, fund ecosystem growth, generate a return sufficient to preserve the protocol in any market environment, and reduce the idiosyncratic risk of the concentrated AAVE position while maintaining exposure to the protocol1. MatthewGraham further elaborated on the use of derivatives to balance risk exposure and the importance of the Aave Treasury participating in metagovernance1. He also outlined a holistic risk management framework considering various external and DeFi-specific risks1.

However, Pakim249 challenged the premise of maintaining concentration in the native AAVE token, arguing that it could hurt the decentralization of the protocol and may not be in the best interest of AAVE in the long term2. In response, Elisafly and Eek637 proposed a more active management approach for the treasury, emphasizing the importance of maintaining flexibility and the use of a committee to implement high-level strategies4.

In conclusion, the discussion has led to a comprehensive proposal for the strategic management of the Aave treasury, with a focus on risk management, diversification, and active management. The community is now tasked with reviewing these proposals and deciding on the best course of action for the future of the Aave treasury.

Posted 2 years ago

Last reply 2 years ago

Summary updated 2 months ago

Last updated 03/12 14:23