Governance Security Model

Ensuring the security of the governance process is paramount to protect the protocol from malicious activities and unintended consequences.

Decentralized governance empowers the community but also introduces vulnerabilities that need to be proactively managed. Amplified’s governance security model incorporates multiple layers of protection, inspired by best practices from established DeFi protocols, to safeguard user funds and protocol stability while ensuring efficient operations.

Execution Timelocks

Timelocks are a foundational security mechanism in Amplified’s governance system, creating mandatory waiting periods between proposal approval and execution. This buffer period helps prevent malicious or rushed changes by allowing the community and security experts to intervene if necessary. Proven effective in protocols like Compound and Aave, timelocks provide both immediate and long-term protections.

1. Purpose of Timelocks:

   • Provides a buffer period to detect malicious proposals.

   • Allows the community to respond to concerning changes.

   • Provides time for thorough security analysis.

   • Creates a window for emergency intervention if required.

2. Timelock Structure:

   • Standard Proposals:

     • Duration: 2-day mandatory waiting period.

     • Purpose: Applies to routine protocol changes, allowing adequate review time while balancing security and operational efficiency.

   • High-Risk Proposals:

     • Duration: Extended 5-day waiting period.

     • Purpose: Applied to significant protocol changes to allow for in-depth security assessments and extended community review.

   • Emergency Proposals:

     • Duration: Flexible, based on urgency and risk level.

     • Purpose: Provides rapid response capabilities during critical incidents while maintaining heightened scrutiny.

Emergency Protocols

Amplified’s governance system includes robust emergency protocols designed to quickly address critical situations, such as potential protocol hacks or liquidity issues. These protocols enable swift action to protect user funds and maintain protocol stability, incorporating a balanced approach to ensure security during urgent responses.

1. Emergency Pause Mechanism:

   • Activation: Triggered by the Emergency Council with a multi-signature requirement.

   • Function: Immediate system pause capability to protect user funds during an active incident.

   • Purpose: Prevents further impact during a security breach or critical issue.

2. Emergency Response System:

   • Fast-Track Proposals: Expedited voting processes with maintained security checks and higher approval thresholds.

   • Timelock Bypass Conditions:

     • Activation Criteria: Strict requirements for activation, ensuring only essential actions are taken.

     • Approval: Requires multiple approvers with a limited scope of actions.

     • Transparency: Full transparency requirements to maintain community trust.

Risk Management and Mitigation

Amplified’s risk management framework combines decentralized security measures, continuous monitoring, and community safeguards to mitigate threats effectively.

1. Security Infrastructure:

   • Smart Contract Security:

     • Regular audits by professional security firms.

     • Continuous contract monitoring for vulnerabilities.

     • Bug bounty programs to incentivize external validation.

     • Ongoing security updates to address emerging risks.

2. Community Protection:

   • Real-Time Monitoring:

     • Automated systems monitor for unusual activity and anomalies.

     • Automated alerts notify governance members of potential issues.

     • Quick response protocols are in place for emerging threats.

3. Decentralized Security Measures:

   • Emergency Council:

     • Comprised of trusted members with technical expertise.

     • Limited emergency powers to prevent misuse.

     • Representation of community interests to maintain decentralized control.

   • Multi-Signature Controls:

     • Requires multiple approvals for critical actions.

     • Distributed key management to avoid single points of failure.

     • Enhances transaction security by ensuring collaborative governance.

4. Governance Safeguards:

   • Proposal Filtering:

     • Automated security checks for proposal validation.

     • Risk assessments and compliance verification before proposals are put to a vote.

   • Veto Mechanisms:

     • Oversight by the Emergency Council with time-bound veto powers.

     • Clear veto criteria and transparent processes to maintain community trust.