@Cbb0fe in my mind, the determining factor is, is the bridge "part of" the kelpdao protocol or not? if it is, one could say that rsETH users and collateral integrations accept bridge risk even while they are on ethereum
with stablecoin markets beginning to become illiquid, the situation is now entering a more dangerous stage imo
to break down the driving factors:
the ETH market is ~16.5% backed by rsETH, and rsETH backed loans could see up to 10-15% haircut in emode if losses are socialized equally on mainnet & external chains, leaving 2-3% residual haircut for ETH suppliers after wiping out umbrella
ETH suppliers are naturally incentivized to get out ASAP to avoid this, so utilization is pinned at 100%, and borrow rates are not high enough to incentivized repayment of unrelated LST loops (wstETH, weETH) to free up liquidity
because it is impossible to withdraw ETH, users borrowing stables like USDT against ETH collateral cant unwind their position even when the rates for stablecoin borrowing start to spike, which severs the typical incentives scheme keeping these markets healthy
now we have 2 unhealthy incentives based on the markets becoming locked at 100% utilization
1) ETH holders cannot unwind their positions to maintain healthy LTVs, and liquidators cant withdraw/sell collateral to close positions atomically, meaning that ETHUSD price drop could potentially cause bad debt
2) users supplying USDT have a perverse incentive to max-borrow other stablecoins as a way of exiting, the position has positive carry (for now) so the optionality has low cost, while if conditions worsen they can get at least 75% of their position value out of the market
bottom line is, for these pooled/rehypothecated lending markets to function properly, liquidity must be preserved AT ALL COSTS. recent slope2 changes nerfing Aave's max borrow rates are having a negative effect and significantly increasing the risk of cascading market failure
Given strong initial interest, the pre-allocation cap for Cascade’s Liquidity Strategy (CLS) will be raised to $2M on Tuesday, Jan 6th at 12pm ET.
This is the next opportunity for eligible users to earn Cascade rewards ahead of trading going live.
@future_is_btc@cz_binance Bro, i went short or 2 minutes. How did this happen. After longing alll the time and havind so much conviction. I got liquidated and sidelined on the coins I had so much conviction for. My stomach hurts man. I wish everybody the best, they deserve to win with $Aster.
I've been longing $Aster the whole time,... litterally the whole time.
And just when everything was going down I decided to short. And than @cz_binance posted he bought Aster.
I got liquidated in seconds... I don't know know what to say, just don't do like me. Best of luck
Longed ENA at ~$0.45 around 07:55 IST, placed TP at $0.454 at 7:55 ist for $300 profit. Order stayed open despite price hitting target—platform froze. Couldn't exit for ~2 hrs, ended up closing at a $1,300 loss on a leveraged position. Risked liquidation. Need accountability.
@vnovakovski@ButcherWhoRU@degenomics@HyperliquidX@Lighter_xyz Longed ENA at ~$0.45 around 07:55 IST, placed TP at $0.454 at 7:55 ist for $300 profit. Order stayed open despite price hitting target—platform froze. Couldn't exit for ~2 hrs, ended up closing at a $1,300 loss on a leveraged position. Risked liquidation. Need accountability.
MIDL.dev is voting NO to a governance-initiated transfer on the Sui network. It sets a bad precedent, hurts $SUI as a neutral store of value and ultimately harms the ecosystem. Freezing the funds so they remain out of reach of hackers is a sufficient middle ground.