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That's not the complete story. They have lost one asset with a certain set of liquidity characteristics, and unexpectedly gained one with another set.
by ppf 7y ago
That's not the complete story. They have lost one asset with a certain set of liquidity characteristics, and unexpectedly gained one with another set.
- vinniejames 7y agoThere was nothing unexpected here. Users traded their eth X days ago for dai, with the full intention of adjusting their liquidity characteristics What happened here simply precluded the possibility of the reverse trade when the loan became under collateralized, this was not unclear to anyone involved
- ppf 7y agoTraded? You mean loaned. That was always the wording that was used to promote DAI, whatever the underlying transaction might be.
- vinniejames 7y agoUsers didft "loan" their lost ETH, they traded the ETH in as collateral and took out a loan in DAI. This collateral trade was made with full awareness that if the loan became under collateralized the ETH would be liquidated and sold at auction