As CoinGape reported, the Solana-based “decentralized” lending protocol Solend has been grappling to keep away from a liquidity disaster amid the SOL value crashing and the whale accounts having big margin calls.
Earlier, the Solend protocol deliberate to overhaul the whale accounts with emergency powers. Nevertheless, it confronted an enormous backlash from the group. Whereas the liquidity threat continues to hover over Solend. It has include a 3rd proposal SLND3 that seeks to place a cap on the borrowing restrict and cut back the utmost liquidations.
Solend’s SLND3 Proposes the Following:
- Put a per account most borrowing cap at $50 million. Whatever the collateral worth, any debt above this will likely be eligible for liquidation.
- Begin with a per-account borrow restrict of $120M USD and steadily cut back it to $50M. Solend will implement a discount of $500K per hour.
- Solend plans to restrict the liquidation per transaction by an element of 20. This implies the utmost liquidation shut issue per transaction will cut back from 20% to 1%.
- Solend may even cut back the liquidation penalty for SOL from 5% to 2%. This may assist to scale back the liquidation spam.
For its third proposal, Solend has up to now decreased almost 5,000 group votes with 98% in favor. The announcement notes:
Solend is reaching out to market makers to assist present higher on-chain liquidity. This mixed with our proposals ought to cut back DEX market influence to a manageable degree.
There have been a number of anomalies identified with the voting happening on Solend. A single voter passing on over 90% votes in favor and deciding the destiny of $270m in consumer property.
Properly, Solend has to essentially make things better earlier than issues get from unhealthy to worse and the group loses religion. At the moment, the latest market reversal and the SOL value buying and selling at $35 are giving them respiratory area. Nevertheless, if the market collapses, and SOL drops to $20, there might be main liquidations in place.