Bankless · Thursday, July 30, 2026
Adrian Cachinero outlines Steakhouse's risk management philosophy, centered on protecting principal through careful collateral selection and haircuts, similar to Aave's process. The core principle is minimizing risk to the lender, with a haircut acting as a buffer. Risk assessment focuses on the underlying asset's credit risk and the market/platform risk of the specific loan, using Bitcoin as an example of low credit risk but potentially insufficient haircut.
“When you're describing the role of steakhouse in the vault space, it seems very close, very overlapping, very congruous to both Aave and Yearn? Because Aave has to do some sort of risk management with like onboarding collateral, like whether it's in an isolated market or, you know, a cross margin collateral that, you know, that that's a governance decision. And then also, also your role is to optimize for yield so that depositors maximize their yield, lenders pay, pay the minimum or, or receive them, receive the most of borrowers pay the minimum. And so it seems like it's, it's some sort of intersection between both Yearn and Aave. How accurate do you think that is? And there is, is there any, any fix, any changes you would add to that, to that comparison?”
“We aim to minimize the risk to the principal as much as possible. There are many levers that will mitigate the risk to the lender. The chief among them is the haircut. So the fact that a borrower can't take more than 100% loan to value. against their position and often they have to take a significant haircut to the collateral value. This is an enhancement that protects the lender because it gives buffer and time for the loan to be repaid.”
“In our risk management, so we aim to do principal protection through collateral selection and then let the market kind of balance where it finds the most fit. And the selection of the collateral for our proposals orients largely around sort of credit risk in the underlying asset and then market and platform risk for the specific loan.”