@inproceedings{eaebfc49563a41f997673f4e01bb6193,
title = "Contagion in Decentralized Lending Protocols: A Case Study of Compound",
abstract = "We study financial contagion in Compound V2, a decentralized lending protocol deployed on the Ethereum blockchain. We explain how to construct the balance sheets of Compound's liquidity pools and use our methodology to characterize the financial network. Our analysis reveals that most users either borrow stablecoins or engage in liquidity mining. We then study the robustness of Compound through a series of stress tests, identifying the pools that are most likely to set off a cascade of defaults.",
keywords = "decentralized finance, financial contagion, financial network, stress test, systemic risk",
author = "Natkamon Tovanich and Myriam Kassoul and Simon Weidenholzer and Julien Prat",
note = "Publisher Copyright: {\textcopyright} 2023 ACM.; 2023 Workshop on Decentralized Finance and Security, DeFi 2023 ; Conference date: 30-11-2023",
year = "2023",
month = nov,
day = "27",
doi = "10.1145/3605768.3623544",
language = "English",
series = "DeFi 2023 - Proceedings of the 2023 Workshop on Decentralized Finance and Security",
publisher = "Association for Computing Machinery, Inc",
pages = "55--63",
booktitle = "DeFi 2023 - Proceedings of the 2023 Workshop on Decentralized Finance and Security",
}