Lazy Summer Protocol Risk Curator Announcement

General Discussion
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Introduction

We are excited to announce that BA Labs (operating under the Block Analitica brand) has joined Lazy Summer Protocol as Risk Curator!

In this post, we examine Lazy Summer Protocol parameters and provide an overview of our bespoke risk framework. We also explain how our framework and our risk curation efforts will evolve as the protocol scales.

An Overview of Risk Parameters in the Lazy Summer Protocol

The figure below provides a summary of key parameters associated with the Lazy Summer Protocol.

At the highest level, there are Lazy Vaults — the protocol’s main user-facing component. Each Vault represents a Fleet with three relevant elements:

  1. Fleet Commander: Where users deposit and withdraw funds. Controls the respective Arks in a Fleet and includes rebalancing logic. It also contains the “global” parameter called “deposit cap,” which must be set to ensure the safe growth of underlying Arks.
  2. Arks: A Vault/Fleet can contain multiple Arks, each linking deposited funds to unique third-party protocols or pools. To optimize risk-adjusted returns, parameters such as the Ark’s Max Deposit Cap, the Max % of Fleet TVL, and rebalance limits on inflows and outflows, must be carefully calibrated.
  3. Buffer Ark: Each Fleet has a Buffer Ark — an Ark with no underlying protocol. From a risk perspective, setting an adequate “Minimum Buffer ARK Balance” for each Lazy Vault is crucial to maintaining sufficient liquidity for user withdrawals while ensuring maximum capital efficiency.

Block Analitica’s Risk Framework for Lazy Summer Protocol Parameter Setting

Block Analitica has developed a bespoke risk curation framework to optimize risk-adjusted yields across Arks, Lazy Vaults, and ultimately the Lazy Summer Protocol as a whole. The goal is to achieve balanced risk management, liquidity optimization, and scalable deployment. Our approach is intended to evolve over time based on market conditions and new data.

In summary, our framework is designed to:

  • Balance risk and reward by factoring in volatility and collateral quality
  • Ensure sufficient liquidity for withdrawals and rebalancing
  • Scale dynamically in line with protocol growth and market conditions

Our risk assessments will incorporate multiple financial metrics, with ongoing enhancements to include broader risk factors. For instance, we evaluate volatility, collateral quality, liquidity depth, and rehypothecation exposure. Liquidity buffers and rebalancing thresholds will be set to optimize capital deployment while adapting to changes in market rewards and user behavior. We will also gather data on assets’ smart contract security to assess the technical quality of collateral types.

To check the full initial parameters for SummerFi Lazy protocol, please check our proposal on the SummerFi forum.

Framework Evolution

At launch, initial limits have been set relatively conservatively. We believe this is a prudent approach to ensure a controlled risk profile while at the same time enabling expansion as liquidity grows and our risk framework becomes more refined. Our framework is designed to evolve in response to new data and market insights. Its open-ended design also allows us to adjust parameters to accommodate different risk appetites within the Lazy Summer Community.

Block Analitica is also prepared to facilitate the onboarding or removal of Vaults and Arks as the protocol evolves. Our objective is to continuously adapt our risk curation and risk framework to accommodate new protocol upgrades.

Community Engagement

Block Analitica will provide regular updates to the community through the Lazy Summer Protocol Forum. These updates will include proposed parameter adjustments when necessary, feedback on community proposals, risk assessments for new Vaults or Arks, as well as periodic updates on our risk framework.

We look forward to supporting the health and growth of the Lazy Summer Protocol and deepening our engagement with the community. If you have any questions or would like to learn more about us, refer to the links below.

Email: info@blockanalitica.com

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