Solend: Propousals, throw-ins and liquidations
Solend is a landing protocol on Solana. Allows you to take loans secured.
On June 15th, the Solend founder noticed that one wallet takes $107 million out of the 171st one he had. The position was secured by 5.7m Solana, the liquidation price was at $22 for 1 SOL.
The founder suggested that the “mega whale” knock on private messages for help.
Why is this a problem?
Solend has implemented a partial liquidation mechanism. When the liquidation price is reached, 20% of the user’s balance goes to DEX’s. According to conservative estimates, these 20% (~1.2m SOL) sank the glass by 50%.
Lightning-fast price drops are usually followed by lightning-fast cascade liquidations.
3 steps to the pit
Step 1
The Solend team is afraid of the risk of zeroing the Solar and launches the DAO in a hurry. A few hours after the announcement, the first governance of the propousal is rolled out — SLND1.
It tells about the plan to withdraw the rescue of the whale tokens and the entire ecosystem. Updating the smart contract of the landing page and the forced liquidation of the whale on OTC are the main points of the promotion.
SLND1 is accepted, but unlike voting on Juno, it does not receive public support. But the Solend team gets a cup of accusations of betraying the principles of decentralization.
Arguments from the community:
- 98% of the “yes” votes came from one wallet. Suspicions naturally fell on the team. The team denies its participation.
- The voting lasted 6 hours.
- The DAO site was in the “died” position half of that time.
Step 2
Under pressure from Twitter users, the developers of Solend roll out SLND2, which cancels SLND1 and extends the voting time to 1 day.
Most of the “yes” votes come from the same wallet as last time.
The alleged owner is a degen with the nickname “Bloodstone”. He broke into the discord of the protocol, supporting the team, and added: “with great power comes great responsibility, this whale has no responsibility.”
Step 3
SLND2 is accepted, SLND3 is started.
Triquel implies a limit of $50m per wallet and a temporary reduction in the % of liquidated funds per transaction from 20 to 1.
In the interval between the launch and the successful acceptance of SLND3, the whale begins to reduce the position. Part of it takes out completely, part leaves it on Solend, part takes it to the Mango landing page.
Binance got in here too
According to CoinDesk, Binance “woke up the whale” and politely asked to leave Solend.
After his awakening, the “mega whale” apologized to the protocol founder and said that he was not offended by the propousals.
Problem solved
Solend’s reputation has been shaken together with TVL, the whale has saved money, replenishment has arrived in the piggy bank of DeFi tales.
