The index token contains 25 underlying assets in different proportions. In addition to volatility, the market is characterized by more fundamental events that can have a critical impact on the underlying asset. As part of the Alongside methodology, the parameters for including the underlying asset in the index are specified, but I would like to raise the following questions: what key parameters are the included assets tracked by, how automated is it, under what scenario can the underlying asset be urgently excluded from the index and how long will it take to is this a viable solution?
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Hey! Really good questions.
Regarding what the token aims to track, you can see a treatment of the circulating market cap weighting here.
Regarding the automation, it is deterministically calculated from the supply and price feeds selected by the Stewards for their accuracy.
Regarding urgent exclusion. Even in cases of hacks or failures of mechanism design like in Terra/Luna, diversification and monthly rebalancing are the safeguard. Essentially, there isn’t currently a reason to have another emergency process alongside the existing processes.
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Great question with which i faced on by myself! Thanks for asking @ASSOC-exe and for answering @rai !
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