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tags: Snippets
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# G&R #168 Snippet

This `snippet` includes Governance, MIPs, forum updates, and Core Unit team discussions from the MakerDAO Governance and Risk Call #168.

## General Updates

### Votes

*Executive:*
- Last Week’s executive - PASSED & EXECUTED
- Parameter Changes to GUNI, WSTETH, D3M
- 218,059.10 DAI Returned to the Surplus Buffer
- Executive proposal up for vote tomorrow. Will include:
- WBTC-B Onboarding
- WBTC Stability Fee Changes
- Local Liquidation Limit (ilk.hole) Changes
- Change of Covenants for P1-DROP (Peoples Company Series 1)
- Offboarding Collaterals

*Polls:*
- 6 Weekly Polls - PASSED
- [Local Liquidation Limit Adjustments for ETH-A, ETH-B, ETH-C, WBTC-A and WSTETH-A](https://vote.makerdao.com/polling/QmQN6FX8?network=mainnet#poll-detail)
- [Rates Proposal (WBTC Stability Fees)](https://vote.makerdao.com/polling/QmRUgsvi?network=mainnet#poll-detail)
- [Change of Covenants for P1-DROP (Peoples Company Series 1)](https://vote.makerdao.com/polling/Qma62bse?network=mainnet#poll-detail)
- [Offboard the AAVE-A Vault Type](https://vote.makerdao.com/polling/QmPdvqZg?network=mainnet#poll-detail)
- [Offboard the BAL-A Vault Type](https://vote.makerdao.com/polling/QmcwtUau?network=mainnet#poll-detail)
- [Offboard the COMP-A Vault Type](https://vote.makerdao.com/polling/QmRDeGCn?network=mainnet#poll-detail)
- 2 New Greenlight Polls (Vote ends on Monday)
- [SB-frOGI (SolidBlock Red Frog Digital Coin)](https://vote.makerdao.com/polling/QmYGUEFy?network=mainnet#poll-detail)
- [MONETALIS (Monetalis Wholesale SME Green Growth Lending)](https://vote.makerdao.com/polling/QmS52AtS?network=mainnet#poll-detail)
- 8 Ratification Polls close Monday - 2021-11-22

### MIPs

[Weekly MIPs Update #62](https://forum.makerdao.com/t/weekly-mips-update-62/11653)


- The Ratification Polls for November are now entering their second and final week.

### Forum at a Glance

[Forum at a Glance: November 11 - 18](https://forum.makerdao.com/t/forum-at-a-glance-november-11-18/11713)

## Team-led Discussions

### Bear Market Market Condition Prep

#### Are We Prepared? How Do We Prepare?

- PSM gets filled during bear markets because people rush to repay loans.
- But how high can we afford to go in USDC on centralized stablecoins?
- People will liquidate volatile positions to less risky assets.
- Bear market may drop yields during farming and reduce stablecoin saving/lending due to increased risk.
- A stablecoin unwinding is a low-chance possibility.
- Any immediate spike in demand will deflate over time as fear elleviates in the markets.
- Have there been any simulations created for multiple collaterals over time in bear markets?
- Primoz: Yes, you can simulate that yourself in the Risk Dashboard.
- We began developing a framework called Asset Liability Management.
- Some assets like renBTC and UniV2 are difficult to liquidate large vaults.
- These assets are not ready for a giant liquidation wave.
- Auction demo keeper did not perform well.
- PE CU is trying to handle UniV3 to be able to handle such a situation and add a good liquidator.
- Things to do to be prepared: update liquidation keepers.
- However, liquidating large Vaults would take way too long, which provides potential open market risk.
- Liquidating smaller chunks allows borrowers to save themselves.

#### What Happens in the Event of Sudden Loss or Invalidation of Collateral?

- Emergency Playbook by Davidutro:
- During an emergency, the following occurs:
- Communications coordination.
- Technical coordination.
- General coordination.
- Etc coordination.
- The Emergency Playbook documents and connects all coordination processes as clearly and successfully as possible.
- It's important to communicate and get auction keepers to participate in auctions during such bad events.
- Need to double check Signal Group and check all the auction keepers info.
- Make sure everything still works and who is active/inactive.
- However, keepers are very private and competitive about their operations; it's difficult to get any contact information about them.
- Keepers are highly incentivized by profits.
- Should new collateral types require a period of mandatory fire drills for their liquidation systems?
- Test experiences help Maker improve and better-prepare for actual events.
- We need to immediately update keepers for ability to perform easier liquidations
- What happens if we lose network access?
- Losing access to memory pool or nodes causes prices to continue to fall.
- However, we have a cusp where after X% of a price fall forces auctions to be redone.
- We should have a backup network like L2 where we can source liquidity on it.
- Wormholing should help solve this.
- In future, most capital will move to L2s.
- We will need everything on L1 to be integrated and adopted into the new L2 world.
- Also, how long will it take for this to happen? Potentially, sooner than we think.
- How can we educate our Vault users to use risk-mitigation tools?
- Yes, this is super important and Vault protection promotes more income because users apply higher risk.
- Alternate unhappy perspective:
- Market crash happens and we proceed with buy/burn.
- We get surplus from penalties to buy MKR, but then market dips even more! We end up with more bad debt.
- Will cause to reprint more MKR than was burned.
- We should be agnostic towards what solutions to use but instead focus on educating Vault users on all solutions.
- Basic information is currently available in the community portal; more information coming soon.
- Reach out to Content Production for any ideas and feedback on this.
- What if during a market liquidation, users stick to central stablecoins and don't use Dai?
- This can cause peg to break highs.
- We don't need USDC or other stablecoins to do a PSM now! We can do it ourselves.