We are very proud to introduce Automation v2, available now at https://t.co/Tecyt1ghPM.🎉
Read our full post here: https://t.co/hTI1TOtJoJ
— DeFi Saver (@DeFiSaver) April 13, 2020
Automation lets users configure settings to automatically increase or decrease leverage in their Vault as the price of the underlying collateral changes, effectively providing DeFi users with automated leverage and liquidation protection.
In light of the volatility last month and Maker’s Black Thursday, where a handful of users suffered liquidations significantly below market value, automated vault management is beginning coming to the forefront for DeFi users.
While the first version of Automation was released back in September 2019, today the team is excited to share the next major version of the product.
With Automation v2, the vault management tool reacts to next price updates – providing more effective Vault protections – along with supporting DeFi Saver’s new flash loan powered features for better optimized ratio adjustments.
The Maker Protocol features a unique price oracle where the price of collateral is updated once every hour. This is an important feature as it largely smoothens out any flash crashes and significant short-term volatility. However, with DeFi Saver’s Automation, the design allows a large enough price update to completely bypass the users liquidation or leverage preferences – potentially allowing the minimum ratio to drop below 150% in one fell swoop.
Unfortunately, this design is what allowed some DeFi Saver users to have their vaults liquidated on Black Thursday. To combat this, Automation v2 introduces next price updates, essentially allowing the product to protect your CDP even before the price update goes through. With this v2 update, DeFi Saver users should now be protected in the instance of another Black Thursday-like liquidation event.
The second major update with Automation v2 is integrating DeFi Saver’s Extended Boost and Repay features. In March, DeFi Saver launched Boost and Repay – two product features leveraging flash loans for more granular adjustments in leverage while simplifying the number of transactions for both users and the system. The integration of Extended Boost and Repay effectively provides users with more configurability and in turn, creates more seamless vault management.
Finally, the last major change with Automation v2 is adjustments to service fees.
For those unfamiliar, DeFi Saver is a self-funded team and all service fees are used to sustain development and maintenance on the product. That in mind, the service fee is increasing from 0.25% to 0.3%, meaning any adjustments made by Automation incurs a 0.3% fee of the Repay or Boost amount.
Automated Vault Management is massively valuable for DeFi. By not having to worry about managing Vaults, DeFi users can now have peace of mind that their precious collateral is safe – even during times of unprecedented volatility.
All existing DeFi Saver users will need to upgrade to the new and improved v2 in the coming weeks. The previous version will be shutdown on May 13th.
DeFi Saver is making huge strides in providing intuitive asset management tools for DeFi. Automation V2 is another step in the right direction. With a wider range of automated asset management tools now available, the DeFi space becomes more robust and in turn, more prepared for the next battle at hand.
It’s an incredibly interesting time for DeFi asset management as more and more tools become available for our userbase. In the coming months, we’ll be on the lookout for more interesting and valuable asset management tools to pop-up. If we find any, we’ll be sure to report it.
Analyst at Bankless – one of the leading resources for open finance. Lucas is an active contributor to the DeFi ecosystem with appearances in other notable DeFi outlets including The Defiant and Our Network. He has years of experience working with dozens blockchain and token startups where he focused on token economics, marketing, and growth.