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I'm only surprised why would the Solend team care about crashing the price of Solana. Why would the Solana care either for that matter (I don't know if they are

I'm only surprised why would the Solend team care about crashing the price of Solana. Why would the Solana care either for that matter (I don't know if they are the same people though). If it crashes because of a sudden bulk market liquidation then it is just working as intended, and eventually the price of SOL will recover if there is user confidence.

wmf 4y ago
Heh, user confidence comes from the price. If the price goes near zero, many people will leave and never return.
- yieldcrv 4y ago
  But a $170m liquidation o a DEX will only cause a flash crash on the DEX. Its a boon for arbitrageurs, its an oligarch level opportunity if you are paying attention. Even with such a crash or "liquidation function" also crashing the network, blocks will eventually continue to be produced even with Solana's level of availability. So just let it happen. Anyway, too late, half a million dollars of tokens voted to control $170m of user funds.
ntoskrnl 4y ago
It might not have a lot to do with price. The Solana network itself is too fragile to handle a liquidation like this. They're trying to keep the network from crashing. Needless to say, the network has one job, and it keeps failing miserably. Solana goes dark for the seventh time in 12 months - https://www.cryptopolitan.com/solana-why-is-solana-down/ https://www.cryptopolitan.com/solana-why-is-solana-down/
colinsane 4y ago
whale has put up $170M of SOL and borrowed $100M of USD. that USD was supplied by other people on Solend who expect to be repaid. “liquidation” is a way to ensure those lenders are repaid: if the borrower no longer has enough collateral to be incentivized to pay back the loan — or rather before that happens — liquidators will recover the lenders’ money by seizing the borrower’s collateral, selling it on the market, and returning the USD proceeds to the lenders. the worry about SOL price drop is: can this $170M of SOL really be sold to make the lenders whole of their $100M USD? or will SOL significantly drop as that trade is executed and the lenders can only recover (say) half that? most lending platforms place a cap on the total amount of each type of collateral they’ll accept — in large part to protect against these liquidation scenarios. it looks like there’s worry that Solend was too lax with their cap.
- UncleEntity 4y ago
  Is that literally the case though? Or is it that if the price crumbles the whale will be able to pay back the loan for pennies on the dollar because they need to repay in the crashed tokens? One way was a really good bet and having their tokens confiscated to ensure they don’t benefit is probably outright fraud while the other way is just a bankruptcy where confiscating their tokens is probably outright fraud unless they have a previous contractual agreement which states it is permissible. Hard to tell what is happening in the cryptocurrency space because too many people have an agenda to just state the facts. —edit— Or a loan which may or may not need to be liquidated at some future point and they seized the collateral “just in case” like pre-crime.

wmf 4y ago

Heh, user confidence comes from the price. If the price goes near zero, many people will leave and never return.

yieldcrv 4y ago
But a $170m liquidation o a DEX will only cause a flash crash on the DEX. Its a boon for arbitrageurs, its an oligarch level opportunity if you are paying attention. Even with such a crash or "liquidation function" also crashing the network, blocks will eventually continue to be produced even with Solana's level of availability. So just let it happen. Anyway, too late, half a million dollars of tokens voted to control $170m of user funds.

ntoskrnl 4y ago

It might not have a lot to do with price. The Solana network itself is too fragile to handle a liquidation like this. They're trying to keep the network from crashing. Needless to say, the network has one job, and it keeps failing miserably. Solana goes dark for the seventh time in 12 months - https://www.cryptopolitan.com/solana-why-is-solana-down/ https://www.cryptopolitan.com/solana-why-is-solana-down/

colinsane 4y ago

whale has put up $170M of SOL and borrowed $100M of USD. that USD was supplied by other people on Solend who expect to be repaid. “liquidation” is a way to ensure those lenders are repaid: if the borrower no longer has enough collateral to be incentivized to pay back the loan — or rather before that happens — liquidators will recover the lenders’ money by seizing the borrower’s collateral, selling it on the market, and returning the USD proceeds to the lenders. the worry about SOL price drop is: can this $170M of SOL really be sold to make the lenders whole of their $100M USD? or will SOL significantly drop as that trade is executed and the lenders can only recover (say) half that? most lending platforms place a cap on the total amount of each type of collateral they’ll accept — in large part to protect against these liquidation scenarios. it looks like there’s worry that Solend was too lax with their cap.

UncleEntity 4y ago
Is that literally the case though? Or is it that if the price crumbles the whale will be able to pay back the loan for pennies on the dollar because they need to repay in the crashed tokens? One way was a really good bet and having their tokens confiscated to ensure they don’t benefit is probably outright fraud while the other way is just a bankruptcy where confiscating their tokens is probably outright fraud unless they have a previous contractual agreement which states it is permissible. Hard to tell what is happening in the cryptocurrency space because too many people have an agenda to just state the facts. —edit— Or a loan which may or may not need to be liquidated at some future point and they seized the collateral “just in case” like pre-crime.