Michael Egorov, founding father of decentralized finance (DeFi) protocol Curve Finance, claims to have repaid 93% of $10 million in unhealthy debt from the protocol’s gentle liquidation triggered earlier within the day.
“Dimension of my positions was too giant for markets to deal with and precipitated 10M of unhealthy debt,” said Egorov. “I’ve already repaid 93%, and I intend to repay the remainder very shortly.”
On June 13, Curve Finance’s gentle liquidation mechanism efficiently managed a real-world take a look at throughout a current hacking try, however its native CRV token worth plunged by over 28% amid the chaos. In line with blockchain analytics agency Arkham Intelligence, Egorov himself confronted $140 million in liquidations attributable to “borrowing $95.7M in stablecoins (largely crvUSD) in opposition to $141M in CRV throughout 5 accounts on 5 protocols.”
In the course of the peak of the hack, Egorov confronted paying $60 million in annualized charges to take care of his borrowings. Arkham explained:
“It’s because there may be nearly no remaining crvUSD accessible to borrow in opposition to CRV on Llamalend. Three of Egorov’s accounts already make up over 90% of the borrowed crvUSD on the protocol. If the value of CRV drops by ~10%, these positions might start to be liquidated.”
Egorov has since proposed burning 10% of the excellent CRV tokens, price $37 million on the time of publication, to stabilize the token’s worth to pre-incident ranges. “As a reward, Energetic voters will earn a 3-month APY booster on all platform deposits,” the blockchain govt commented.
This was not the primary time Egorov’s CRV holdings and borrowings have impacted the protocol throughout instances of duress.
In August 2023, Curve suffered an exploit amounting to $62 million, which too, resulted in unhealthy debt from Egorov’s $100 million borrowings on Curve on the time. The blockchain govt finally paid the funds again.
Curve is presently the nineteenth largest DeFi protocol, in response to blockchain analytics platform DeFiLlama. It has greater than $2 billion price of crypto belongings locked inside its contracts.
Associated: Curve Finance awards dev $250K for finding re-entrancy vulnerability
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