Cooler Loans

Cooler Loans receives a C+ risk grade (38/100) from Hindenrank, where lower scores indicate lower risk. Elevated risk — the no-liquidation treasury-backed lending mechanism is innovative but places the full solvency risk on the Olympus Treasury; OHM's history of extreme price volatility makes this backstop's adequacy the critical unresolved question. Cooler Loans is Olympus DAO's native lending product that enables gOHM holders to borrow USDS (Sky stablecoin) at a fixed 0.5% APR with no price-based liquidations — the Olympus Treasury itself is the lender, and all loans persist indefinitely regardless of gOHM market price. With $190M TVL, $127M in active loans, and no incidents since launching in July 2024 (V2 in May 2025), it is the largest DeFi lending product without price-triggered liquidations. Its C+ grade reflects the genuine novelty of its mechanism — which eliminates oracle attack risk at the cost of treasury solvency risk — combined with governance concentration on all key parameters and OHM's historically thin liquidity. The 'no liquidation' guarantee is backed by Olympus Treasury USDS reserves, not smart contract enforcement, making treasury solvency the critical risk factor that cannot be assessed from on-chain data alone.

The key risks identified for Cooler Loans are: (1) The 'no liquidation' guarantee means the Olympus Treasury absorbs the loss if gOHM falls below the governance-set LTV (~2,961 USDS/gOHM). With OHM's history of 98.8% price declines, and current OHM price at ~$16, the treasury solvency backstop could be tested by a moderate further price decline. (2) All critical parameters (interest rate, LTV, default thresholds) are set by Olympus Community Governance (OCG) votes. A single successful vote can change any parameter, including setting unrealistically high LTVs that would allow borrowers to drain treasury USDS. (3) gOHM has extremely low market liquidity ($18K daily volume against $245M market cap). If you need to exit a large gOHM position or the protocol undergoes stress, market impact from selling gOHM in open markets can be severe. (4) Loans are perpetual with no maturity date. The Olympus Treasury must maintain over $127M in liquid USDS reserves indefinitely. Any treasury reallocation to illiquid investments reduces this buffer.

Cooler Loans scores 38/100 across eight risk dimensions: Mechanism Novelty: 9/15, Interaction Severity: 12/20, Oracle Surface: 0/10, Documentation Gaps: 2/10, Track Record: 3/15, Scale Exposure: 5/10, Regulatory Risk: 3/10, Vitality Risk: 4/10. The highest risk area is Mechanism Novelty at 9/15.

Among 99 rated Lending protocols on Hindenrank, Cooler Loans ranks #56 by safety (lowest risk score = safest). Its 38/100 risk score and C+ grade place it in the middle tier of Lending protocols.

Cooler Loans scores 3/15 on the Track Record risk dimension, indicating some history of security incidents or exploits. Higher scores reflect more severe or frequent incidents. Review the full risk report for details.