Reading time saved: 22 minutes
4 replies, 2832 views, 37 likes
The collaboration between Gauntlet and the Arbitrum Foundation aims to facilitate the migration from bridged USDC.e to native USDC on the Arbitrum network, enhancing transaction simplicity and security. Despite potential risks and uncertainties, the community is actively involved, with 17% of USDC.e already unbridged, and Gauntlet's comprehensive risk management framework and subsequent reports provide valuable guidance and insights.
The discussion primarily focuses on the collaboration between Gauntlet and the Arbitrum Foundation to facilitate the migration from bridged USDC.e to native USDC on the Arbitrum network. The objective is to replace bridged tokens with native tokens, which are considered simpler and more secure. The report by Gauntlet provides a comprehensive framework for understanding risks at the ecosystem level and guides the community through this process. The success of the migration is defined as the minimized use of bridged tokens in favor of native USDC on the Arbitrum L2. The discussion also delves into the importance of ecosystem risk management, various models of deprecation, the concept of adoption curves, exchange rates, and Atomic User Characteristics.
The community is actively involved in the migration process, with nearly $150M (17%) of the USDC.e being unbridged, indicating that early adopters see the value of transacting in native token vs. bridged token. However, there is uncertainty about the specific path the Arbitrum community will decide upon regarding the deprecation of USDC.e collateral. The community is actively engaging with Gauntlet's posts, with JoakimEQ questioning the lack of actionable outcomes in the initial report. Gauntlet responded by clarifying the report's intent and promising a follow-up report with specific recommendations. The follow-up report, the Gauntlet Methodology & Recommendations Report, was later shared, outlining a framework for lending protocols, initial recommendations for liquidity requirements, and an alerting plan around USDC.e and USDC.
The migration from bridged USDC.e to native USDC on the Arbitrum network is seen as a positive move as it simplifies transactions and enhances security. The unbridging of nearly $150M (17%) of the USDC.e is seen as validation that early adopters see the value of transacting in native token vs. bridged token. The report by Gauntlet provides a comprehensive framework for understanding risks and guiding the community through the migration process. The discussion provides a comprehensive understanding of ecosystem risk management, which is crucial for the successful migration of protocols. The detailed analysis by Gauntlet, along with the subsequent reports, provides valuable insights and recommendations for the community.
The migration process comes with several risks, including price, liquidity, volatility, flow, and credit risks. There are also potential issues such as cross-protocol pricing discrepancies due to nonstandard oracle usage, liquidity drying up, and token transfer issues. The community could face macro and micro risks, including disjoint migration process, bridging problems, and complicated UX dis-incentivizing USDC.e laggards from adopting USDC. The uncertainty about the specific path the Arbitrum community will decide upon regarding the deprecation of USDC.e collateral also adds to the negative aspects. The complexity of the topic and the detailed analysis provided by Gauntlet might be overwhelming for some community members. The lack of actionable outcomes in the initial report was also a point of contention.
Posted 3 months ago
Last reply 3 months ago
Summary updated a month ago
Last updated 05/12 01:15