Gauntlet proposes that Compound urgently suspend the USDC, USDS, and USDT lending markets on Ethereum

ChainCatcher news, DeFi research and risk management firm Gauntlet has posted a proposal on the Compound forum, suggesting a temporary emergency pause for the following independent lending Comet markets in Compound v3: USDC on Ethereum, USDS on Ethereum, and USDT on Ethereum.

Gauntlet stated that it has observed liquidity crises in Elixir's deUSD and sdeUSD, both of which are listed as collateral for USDC, USDS, and USDT on Ethereum. Gauntlet has already recommended updating the risk parameters (Tally), but these suggestions have not yet been approved by the governance committee. Before the proposal is passed, Gauntlet recommends suspending withdrawals of the affected tokens. This means that in Compound v3, new lending positions or liquidity withdrawals for USDS, USDC, and USDT on Ethereum will not be possible. Yesterday, Stream Finance disclosed that its fund assets suffered a loss of $93 million, with Elixir bearing an exposure of $68 million, and Elixir's deUSD and sdeUSD experiencing liquidity crises.