Drift Protocol is set to relaunch with a focus on recalibrating risk control parameters and funding mechanisms. The team plans to base these parameters on historical order book performance during extreme market downturns, moving away from subjective settings. Initially, a conservative strategy will be adopted, with gradual adjustments as the Total Value Limit (TVL) recovers.
The protocol will link the open interest cap for each instrument to the liquidation capacity under approximately 40% instantaneous reverse volatility to mitigate bad debts. Additionally, the internal market-making module's pricing and spread logic will be optimized to reduce extreme volatility in funding rates. Unnecessary legacy code will be removed to minimize the attack surface. A complete changelog will be provided upon the protocol's reboot.
Drift Protocol to Relaunch with Enhanced Risk Controls and Funding Mechanism
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