Book chapter · Conference paper
Formal Analysis of Lending Pools in Decentralized Finance
Decentralised Finance (DeFi) applications constitute an entire financial ecosystem deployed on blockchains. Such applications are based on complex protocols and incentive mechanisms whose financial safety is hard to determine. Besides, their adoption is rapidly growing, hence imperilling an increasingly higher amount of assets.
Therefore, accurate formalisation and verification of DeFi applications is essential to assess their safety. We have developed a tool for the formal analysis of one of the most widespread DeFi applications: Lending Pools (LP). This was achieved by leveraging an existing formal model for LPs, the Maude verification environment and the MultiVeStA statistical analyser.
The tool supports several analyses including reachability analysis, LTL model checking and statistical model checking. In this paper we show how the tool can be used to analyse several parameters of LPs that are fundamental to assess and predict their behaviour. In particular, we use statistical analysis to search for threshold and reward parameters that minimize the risk of unrecoverable loans.
| Language: | English |
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| Publisher: | Springer |
| Year: | 2022 |
| Pages: | 335-355 |
| Proceedings: | 11th International Symposium on Leveraging Applications of Formal Methods, Verification and Validation |
| Series: | Lecture Notes in Computer Science (including Subseries Lecture Notes in Artificial Intelligence and Lecture Notes in Bioinformatics) |
| ISBN: | 3031197585 , 3031197593 , 9783031197581 and 9783031197598 |
| ISSN: | 16113349 and 03029743 |
| Types: | Book chapter and Conference paper |
| DOI: | 10.1007/978-3-031-19759-8_21 |
| ORCIDs: | Chiang, James , Lluch Lafuente, Alberto and Vandin, Andrea |
