DeFi data platform DeFi Pulse has launched a new safety rating metric in partnership with digital asset modeling platform Gauntlet, according to an announcement made on October 14.
- DeFi Pulse and Gauntlet launched the alpha version “Economic Safety Grade”, with the intention of informing users of the risk of investing in on-chain protocols
- The new metric is aimed at helping investors quantify the risks associated with DeFi investment
- It uses on-chain data, as well as data from centralized and decentralized exchanges to quantify risks across yield products, starting with collateralized lending
- Specifically, the metric takes into account user behaviour, collateral volatility, relative collateral volatility, protocol parameters and smart contract risk
- It does not take into account smart contract vulnerabilities, which have been the source of problems in protocols like YAM and Opyn
- At launch, the risk metric will be available for Aave (AAVE) and Compound (COMP); they have scored 95% and 91% respectively