Risk management

Governance token gives holders the right to vote on the following risk management actions:

Adding a new type of collateralized debt obligation

Creating a new type of collateralized debt obligation with unique risk parameters. A collateralized debt obligation type can be either a new collateral type or a new set of risk parameters for an existing collateral type.

Modification of existing collateralized debt obligation types

A change in risk parameters for one or more existing collateralized debt obligation types.

Change in sensitivity parameter.

Changing the sensitivity of the target rate feedback mechanism.

Changing the target course.

The governing bodies may change the target rate. In practice, a change in the target rate will only take place in one specific case: if voting token holders decide to peg the price of DurovUSD to its current target price.

This will always be done at the same time as changing the sensitivity parameter. Setting the sensitivity parameter and the target rate to 0% will disable the target rate feedback mechanism, and the target price of DurovUSD becomes pegged to its current value.

Selecting a group of trusted oracles.

The platform obtains the internal pledge price and market price of DurovUSD from a decentralized oracle infrastructure consisting of a large number of individual oracle nodes.

Governance token holders control the number of nodes in a group of trusted oracles, and assign nodes falling into that group. The system will continue to operate in continuous secure mode even if half of the oracles are compromised or malfunctioning.

Changing the sensitivity of price quotes.

Changing the rules that determine the maximum change that price quotes can have on internal price values in the system.

Selecting a group of global settlement executors.

Global settlement is a critical mechanism that allows the platform to withstand attacks on oracles and the management process. The management process selects a group of global settlement executors and determines how many settlement executors are needed to run the global settlement process.