Summary

Change the Trading Delay from 6 hours to 2 hours.

Abstract

Change Trading Delay of eUSD to 3600 seconds (2 hours) from 21600 seconds (6 hours). Currently the Trading Delay is an additional buffer of time between an event and when auctions start. When USDC depegged, the protocol initiated a 24 hour “wait-and-see” countdown. This default alarm itself puts the community on high alert to the default, and keeps them on high alert for 24 hours, watching the peg of the asset closely. At the end of the 24 hour period, USDC did not re-peg, and the protocol subsequently allowed for the auctioning of the USDC-denominated collateral. Before the protocol officially allows for the auctioning of the collateral, there is an additional timer, called the Trading Delay, which postponed the auctioning of USDC-denominated collateral for an additional 6 hours. The proposed changed would lessen this additional time, the Trading Delay, to 2 hours.

Problem Statement

The Trading Delay being set to 6 hours is not correct. I believe it should be set to 2 hours, as all events preceding the Trading Delay have sufficient time for the community to become alert. Governance proposals to change the basket of eUSD are one week. Default detections are 24 hours. The Trading Delay of 6 hours is too great of a delay.

Rationale

Both the default “wait-and-see” 24 hour and week long basket change proposal period allow the community sufficient time to be aware of potential impending changes. I do not believe the Trading Delay should be 0 or 1 hour, as I see the Trading Delay to be a planning buffer for teams and individuals. This planning time (Trading Delay) should be sufficient enough to allow some travel and communication for teams and individuals to be present for the auctions.

Risks

It is possible that the Trading Delay being set to 2 hours would cause some issues I am not anticipating.