Solend Steps Back from Controlling the Whale Account

Solend Steps Back from Controlling the Whale Account

With a recent wave of liquidations, the broader crypto loan and staking markets have been experiencing one of the worst crises in history. Solend, a "decentralized" lending platform based in Solana, launched an SNLD1 proposal on Sunday to take over a whale account with emergency powers in order to avoid a cascade of possible liquidations.

Solend alleged that a whale had opened a massive margin position, threatening to liquidate 20% of their borrowing, or $21 million, if the SOL price dropped below $22,30. All users of the Solend protocol would be put in grave danger as a result of this. "This might create havoc and put a load on the Solana network," Solana warned.

However, given that it's a "decentralized" protocol, this sparked outrage in the crypto community for its capacity to govern a whale account. The fascinating part was that Solend received 97.5 percent (1.15 million) of the vote.

The good news is that the crypto market is showing signs of recovery following the weekend slump. As of press time, Solana (SOL) has regained 6.5 percent and is trading above $32.05. This momentarily mitigates the possibility of the whale account at Solend being liquidated.

SLND2 is a new proposal from Solend.

Solend stated in the most recent announcement that they have listened to the community. As a result, the lending platform has proposed SLND2, which decides not to grant emergency powers to the whale account.

“We’ve been listening to your criticisms about SLND1 and the way in which it was conducted. The price of SOL has been steadily increasing, buying us some time to gather more feedback and consider alternatives.

We recognize that a voting time of 1 day is still short, but we need to act swiftly to address the systemic risk and the fact that normal users can’t withdraw USDC. We’re committed to protecting user funds, transparency, and doing what’s right”.

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