2025 Retrospective Details
You can read about our work over the past year in the collapsed text below:
Summary
1.1 Quantitative Research & Risk Portal
LlamaRisk advanced its quantitative capabilities significantly this year. Key developments include the safe borrow cap methodology for LlamaLend v2, the LLAMMA Simulator refactoring into a continuous monitoring system (with Swiss Stake), and simulation-driven parameter optimization across debt ceilings, liquidation discounts, and monetary policy.
- Interest Rate Optimization: Interest rate setting based on simulations on several LlamaLend markets for effective interest rates
- LlammaSimulator: Online model and methodology support of the LlammaSimulator to estimate liquidation and loan discount parameters in LLAMMA-based lending and mint markets.
The Curve Risk Portal continued expanding as Curve’s primary transparency resource for risk:
- Market Health Scores: Real-time scoring across crvUSD and LlamaLend markets using dynamic risk factors, including collateral liquidity, borrower behavior, and market utilization
- Debt Ceiling Methodology: Developed and implemented a monitoring methodology that allows us to identify safe debt ceilings in LlamaLend markets that account for collateral liquidity, borrow behavior, and Curve’s unique LLAMMA soft liquidation feature.
1.2 Curve Beneficiary Grants
LlamaRisk continued serving as the primary intermediary for ecosystem grants:
- Optimism LlamaLend v2 Grant: Secured 250,000 OP tokens from the Optimism Foundation to bootstrap LlamaLend v2 deployment — currently being prepared for distribution
- Foundation Development: Collaborated with Swiss Stake to establish a grant foundation entity in Panama to improve operational efficiency in grants administration.
1.3 Public Outreach
LlamaRisk maintained an active presence in the Curve community and broader DeFi ecosystem:
- Governance Forum: 54 proposals across the grant period
- Research Publications: Published methodologies on debt ceiling frameworks, monetary policy optimization, and market health scoring via llamarisk.com
- Conference Participation: Attended and participated in DeFi conferences in Curve’s target markets, building relationships with asset issuers, capital allocators, and DeFi development teams on behalf of Curve.
- Community Engagement: Maintained public Telegram channel for consultation with developers and protocol users and Twitter account to promote risk-related work on behalf of Curve.
1.4 PegKeepers Curation
PegKeeper management became increasingly critical this year with YieldBasis integration:
- Legal & Qualitative Asset Analysis: Conducted comprehensive legal and qualitative evaluations for new assets being considered for PegKeeper pools, including stability analysis and regulatory implications (e.g., GHO integration assessment)
- USDM PegKeeper Deprecation: Executed a 3-phase clean deprecation of the USDM PegKeeper — removing from price aggregator, setting action delay to zero, killing pool gauges, and fully deprecating — establishing a replicable process for safe PegKeeper offboarding
- frxUSD PegKeeper Onboarding: Successfully proposed and onboarded frxUSD/crvUSD to PegKeepers, diversifying the PegKeeper set
- PegKeeper Pool Optimization: Ramped A parameter on all PegKeeper pools from 500 to 2000, improving swap efficiency and liquidity depth
- GHO PegKeeper Preparation: Began groundwork for onboarding GHO as a new PegKeeper asset, working with TokenLogic on integration assessment and risk evaluation
- YieldBasis Impact Management: Analysis on YB as a first-order driver of PegKeeper inventory dynamics, directly motivating monetary policy adjustments to absorb increased PegKeeper intervention frequency
- Ongoing Evaluations: Continued conducting comprehensive risk reviews for PegKeeper candidate stablecoins
1.5 Protocol Teams Consultation
LlamaRisk continued providing hands-on consultation to protocol teams:
- LlamaLend v2 Launch Coordination: Close collaboration with Swiss Stake on v2 launch timelines, deployment sequencing, and growth plan — ensuring risk frameworks and parameter recommendations are ready before launch
- YieldBasis Deep Analysis: Comprehensive analysis of the YieldBasis-Curve relationship and its impact on crvUSD stability, including arbitrage flow dynamics, pool imbalance mechanics, and PegKeeper capacity requirements. This also involved coordinating with key ecosystem stakeholders across the task force
- Novel Collateral Frameworks: Developed new risk frameworks for novel collateral types including PT assets (Pendle, Spectra) and tokenized gold for crvUSD mint markets, covering oracle design, parameter calibration, and maturity risk assessment
- Oracle & MonPol Development: Developed and deployed custom oracle contracts and monetary policy contracts for specific markets and ecosystem partners — including specialized monetary policies for fxSAVE, sreUSD, sfrxUSD, and sDOLA, and specialized oracles for PT assets
- Oracle Risk Identification: Identified a low-TVL pool being used as the oracle source for the sfrxUSD LlamaLend market, and coordinated with ecosystem partners to increase pool TVL — mitigating a potential oracle manipulation vector before it could be exploited
- EMA Monetary Policy Rollout: Deployed EMAMonetaryPolicy across multiple yield-bearing markets — reducing rate volatility and improving market stability for yield-bearing collateral
- Mint Market Maintenance: Increased LBTC mint market debt ceiling to 20M crvUSD, added weETH to yielding markets classification, and optimized rate parameters across mint markets
- AMM Optimization: Ramped A parameters on DOLA pools and USDC/fxUSD pool to improve swap efficiency and capital utilization
- Gauge Killing & Market Hygiene: Proactive removal of risky assets and deprecated markets across chains — including Elixir markets (deUSD/sdeUSD), iBTC markets on Arbitrum, yETH/ETH pool, InceptionLRT pools, and Polygon Aave V2 aToken pools
- veCRV Whitelist Removal: Proposed and executed the removal of the veCRV whitelist, enabling fully permissionless CRV locking
- Emergency DAO Coordination: With Curve facing heightened risk from volatile market conditions, we consulted with the eDAO and are developing risk frameworks, emergency payloads, and response capabilities — laying the groundwork for faster, more effective defense actions
- Crisis Response: Coordinated with teams during periods of market stress to ensure protocol safety
1.6 Budget Breakdown: 2025
In the 2025-2026 grant period, LlamaRisk received a one year linear vest of 2M CRV to finance a maximum annual budget of $725k. Core team members continued to receive compensation primarily in CRV.
Depending on the CRV price trajectory, we are likely to close the 2025 budget period with an excess ranging approximately between $50k and $130k. This potential surplus should be explicitly acknowledged to ensure full transparency and to avoid any perception of budget over-allocation.
1.7 Retrospective Conclusion
The 2025-2026 period marked LlamaRisk’s most impactful year as a Curve service provider. We navigated the protocol through market stress events, prepared the groundwork for LlamaLend v2, and confronted new challenges introduced by YieldBasis integration.
The trust placed in us by Curve DAO has enabled us to build one of the most comprehensive risk service offerings in DeFi. We enter the 2026-2027 period with the tools, expertise, and alignment to support Curve through its next phase of growth — the launch of LlamaLend v2, scaling of YieldBasis, and continued product expansion.
2026 Budget Details
You can read the breakdown of our proposed budget requirements in the collapsed text below:
Summary
3.1 Current State of DAO Finances
The Curve DAO holds assets across two distinct reserves:
| Reserve | Balance | Nature |
|---|---|---|
| Community Fund | 7,095,144 CRV (~$1.75M) | Fixed allocation from launch. |
| DAO Treasury | ~839,000 crvUSD | Revenue-funded. Accruing an average ~$93K/month since inception. |
The Community Fund was seeded at launch with 151.5M CRV. After grants to the Grants Council (~28M CRV), hack victim refunds (~75.5M CRV), Swiss Stake (2024) (~21M CRV), and the Swiss Stake 2026 grant (17.45M CRV), approximately 7.1M CRV remain. This is a finite, non-renewable resource.
The DAO Treasury was established following the Temp Check: Start Building a Curve DAO Treasury, which identified the unsustainability of funding all operations from CRV reserves. It receives 10% of protocol revenue via the FeeAllocator contract.
Treasury runway for our ask:
- Monthly Treasury income: ~$93K
- Our monthly ask: ~$30K (~32% of income)
- Treasury continues accumulating ~$63K/month net after our allocation
3.2 Proposed Compensation Model
Why Hybrid Funding
Funding recurring operations entirely from the Community Fund assumes CRV reserves are the long-term operating budget. In practice, the Community Fund is finite and depleting, while Curve now has a recurring revenue pipeline and a revenue-funded Treasury.
Under the current grant, our 2M CRV vest translates to ~$493K at today’s prices — way below the operating target. Funding operations exclusively in CRV forces the service provider to sell tokens for every payroll cycle and invoice, creating persistent sell pressure while exposing both the provider and the DAO to funding shortfalls driven by price volatility.
The proposed model funds predictable operating expenses from recurring Treasury revenue (crvUSD), while keeping a CRV vest for long-term alignment. This is consistent with the Treasury’s original purpose: shifting operational funding away from perpetual CRV sales and toward protocol revenue.
CRV Allocation and Volatility Buffer
The CRV allocation is designed to maintain service continuity under price volatility:
- Prior cycle: 2M CRV was approved when CRV traded around ~$0.52, implying roughly ~$1.0M headline value; the excess above operating requirements functioned as drawdown protection.
- Current context: CRV is around $0.24. Modeling a 50% downside scenario ($0.12) implies that 2,500,000 CRV corresponds to ~$300K under stress, pairing with the $360K crvUSD component to cover the ~$660K operating target without requiring mid-cycle renegotiation.
The CRV component is denominated in tokens, not dollars — consistent with how prior CRV vests have been structured across the DAO. For reference, if the DAO preferred to keep the same “all-CRV” approach under today’s prices and the same downside assumption, the equivalent allocation would be approximately ~6,000,000 CRV.
Comparison with Current Grant
| Current (2025-26) | Proposed (2026-27) | |
|---|---|---|
| CRV from Community Fund | 2,000,000 CRV | 2,500,000 CRV |
| crvUSD from Treasury | $0 | $360,000 |
3.3 Team & Operating Expenses
LlamaRisk dedicates 9 contributors (6 FTE-equivalent) to the Curve scope. Maintaining the same budget target while absorbing additional responsibilities — including YieldBasis Task Force coordination, Emergency DAO coordination, and Delegation Proxy groundwork — reflects disciplined cost management rather than scope creep.
A brief description of roles and responsibilities:
- Engagement Lead: Strategy, task management, review, stakeholder point of contact, DAO representative
- Quantitative Lead: Simulation modeling, quantitative frameworks, point of contact with Swiss Stake research team
- Risk Portal Team: Front and backend development — Risk Portal, internal monitoring systems, public dashboards, data pipelines
- Integrations Lead: Growth opportunities, crvUSD supply sink expansion, point of contact with asset issuers and technology providers
- Legal Analyst: Legal research, grants foundation operations, legal disclaimer drafting
Operating expenses include:
- Infra: Cloud servers, website maintenance, gas costs for contract/vote deployments, audit expenses
- Events/Conferences: Attendance and speaking at conferences (planned: 2 during the year)
- Risk Reports: Contracted risk analysts for capacity overflow, as needed
3.4 Disbursement
| Component | Amount | Source | Schedule | Mechanism |
|---|---|---|---|---|
| crvUSD | $360,000 | DAO Treasury | Linear vest (12 months) | Vesting contract |
| CRV | 2,500,000 CRV | Community Fund | Linear vest (12 months) | Vesting contract |
Operational Commitments
Quarterly Reports
LlamaRisk will share reports of activities and spending to the governance forum at the end of each quarter. Reports will be posted in July 2026, October 2026, January 2027, and April 2027.
