[Discussion] A risk framework for tokenized equities on Aave V3 X Layer, with wTCENTx as the worked example

Summary Aave V3 on X Layer holds no tokenized equities, and as far as we can find, no xStock has been proposed on this instance. The tokenized-equity work in front of Aave governance is on another…

• This post proposes a risk framework for tokenized equities on Aave V3 X Layer, highlighting that current parameters are insufficient due to the intermittent nature of arbitrage for these assets.
• It introduces MarketClock, a tool that measures when the primary market for tokenized equities is closed, leading to a significant portion of the week where arbitrage is switched off.
• The proposal suggests a regime-aware LTV or a static LTV sized for the worst-case scenario, emphasizing the need for dynamic risk parameters that account for market availability.

Topics: Asset types, Legal regulatory, Infrastructure providers, Financial instruments, Securities law classification, Tokenization platforms

Tags: #tokenizedequities #aavev3 #xlayer #marketclock #riskframework #arbitrage #primarymarket #ltv #collateral #issuer

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