Users 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

Users 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