Dan LaDuke

Greatly appreciate the knowledge sharing! I seek to understand each and every moving part of the Flare defi ecosystem, hopefully my continuous questioning provides some value on your end. I was able to withdraw USDT0 this morning. Not sure why since borrow still > supply, at least according to Kinetic dashboard.

@MI_Tokenizers You don't have it because you lent it. You have a receipt token saying you have rights to that much though. Kinetic doesn't have it because its literally lent out. But we keep track of all the lent tokens. The borrowers don't HAVE to pay it back until ready or get liquidated.

@Kinetic_Markets The frozen USDT0 in the ISO FXRP-USDTO-stXRP pool is now having the supply rate lower, while the borrow rate remains at 11% despite the overdrawn status (more usdt0 borrows than supply). Users can't remove supplied USDT0, while the interest rate comes down, all while the borrow interest rate should be going up to entice repayment of borrowed USDT0. What gives? Has this market been frozen manually or by automated trigger? What is the status? @FlareNetworks

@Kinetic_Markets Greatly appreciate your quick responses! One last question please; If the borrowed USDT0 is covered by plenty of FXRP ($52M FXRP supplied vs $6M USDT0 borrowed), whats the reasoning behind freezing USDT0 supplies?

@MI_Tokenizers The reason Supply APY is so high is it is incentivized. The borrowers are FXRP suppliers so the "negative liquidity" is money owed which is covered by their FXRP, so there is no actual shortage happening. If a liquidation happens the FXRP is swapped to USDT0 to pay back.

@Kinetic_Markets Under what conditions will supplied USDT0 be able to be withdrawn from the FXRP-USDT0 ISO market?

@MI_Tokenizers Quick TLDR : the markets are not paused. They are fully utilized, this is why you can not withdraw. Interest rates were lowered weeks ago for this specific market and the curve is still in effect it is just much lower now as it is a stable in an iso market.

Supply Rate - The supply APY just dropped from 15% to 11%, but supplied USDT0 is frozen, leaving suppliers subject to these interest rate shifts without recourse. Borrow Rate - Why is the borrow rate not increasing? Is the borrow rate set by governance and not influenced by supply/borrow ratio? Appreciate the response.

@KlemenFDevs @Kinetic_Markets Where are users notified when the Pause Guardian has frozen a market? And why it triggered?

@MI_Tokenizers You’re right on the Jump Rate docs. When the Pause Guardian is triggered, it freezes the curve—rates stay flat even above 100% utilization until unpaused. That lines up with what you’re seeing. Also no public update from Kinetic on this pool— which market is it (FXRP-USDT0 ISO?)?

@MI_Tokenizers Hey, In the ISO FXRP–USDT0 pool on Kinetic, USDT0 borrowing costs are governed by a dynamic interest rate curve. As utilization rises—especially when the pool is heavily drawn down—the rate increases, but in a smooth, gradual way rather than spiking abruptly. This design helps maintain stability while still adjusting to supply and demand.

@KlemenFDevs Yes, FXRP-USDT0 ISO.

Here's the interest rate model from @Kinetic_Markets docs at docs.kinetic.market/liquidity-mark…: "Interest Rate Model: Kinetic employs the Jump Rate Interest Model, a dynamic mechanism that adjusts interest rates based on asset utilization within the protocol. As asset utilization increases, signaling higher demand, interest rates experience significant jumps to incentivize asset deposits and loan repayments. For instance, when asset utilization reaches 80%, a substantial increase in interest rates occurs, stimulating user participation and maintaining liquidity within the lending ecosystem." I'm wondering why interest rates have not seen a "substantial increase" since the pool has surpassed 100% utilization. Has there been an announcement from @Kinetic_Markets regarding a pause via a guardian function?

@MI_Tokenizers If liquidity has been frozen for three days and borrow rates are holding steady at 15%, it likely means the market has been paused via a guardian function. That pause locks utilization, which is why the rate isn’t moving. Kinetic uses a dynamic Jump Rate model that shifts based on the supply-to-borrow ratio, with a defined kink point—more details are in their protocol docs under the interest rate curve section. Which pool are you referring to?

@enosys_global Update: HLN staking succeeded this morning with no errors.

@enosys_global Im getting an 'Insufficient liquidity burned' error when staking HLN in Governance. How do I remedy?

Good morning @Kinetic_Markets and fellow Flare defi enthusiasts! Question: For the ISO FXRP-USDT0 lending pool; when the pool is overdrawn (more borrows than supply, see USDT0) as it is now, why is the USDT0 borrow interest rate not shooting up?

@USDT0_to We saw a large exodus from supply markets on @Kinetic_Markets, shooting borrow APRs up to 95%!

Below is a roundup of proactive updates following recent events across the ecosystem: 1. USDT0 remained secure, with no impact to system integrity, and has processed over $1B in volume since. 2. Our proprietary DVN, built to stay resilient in moments like this, performed as designed. 3. @canary_proto added, changing DVN from 2/2 to 3/3 setup. 4. Exit confirmation times extended to ensure finality before cross-network settlement. Stronger, TogETHER.

@Kinetic_Markets Update: @Kinetic_Markets USDT0 Primary Market borrow rate now at 65%, down from 95% earlier today.

🚨 Whale alert on @Kinetic_Markets (Flare) Address 0xe3bce0fa... just pulled ~1.72M USDT0 from the Primary Market supply pool in a single tx. #Flare $FLR #DeFi

@Brett_FLR @Kinetic_Markets In part. Sell pressure is higher when you need to pay back USDT0 borrows asap.

@MI_Tokenizers @Kinetic_Markets Is that why the price of $FLR just went down?

USDT0 on @FlareNetworks 's @Kinetic_Markets undergoing seismic shifts. Supply/Borrow rates for primary market at 80%/95%. FXRP ISO market USDTO at full capacity, withdrawing not possible atm. Looks like a large USDT0 liquidity withdraw is causing turmoil.

@MI_Tokenizers I understand your frustration—can you share a screenshot of the exact transaction error so we can check the Enosys governance contract docs.

@fAssetsonflr Ive never held HLN/WFLR liquidity and I currently have HLN staked. I've never had this problem before, and this solution sounds ridiculous. Show me the documentation the requires users to hold HLN/WFLR liquidity before staking HLN.

@MI_Tokenizers The “Insufficient liquidity burned” error happens because Enosys requires some HLN/FLR LP tokens (burned/locked) alongside solo HLN staking for ecosystem balance. Add liquidity to the HLN/FLR pair on the DEX first, then stake.