Monday, December 5, 2022
HomeETHBendDAO runs out of funds leaving only 15 ETH to pay lenders

BendDAO runs out of funds leaving only 15 ETH to pay lenders

Lending protocol BendDAO funds drained out overnight. Currently, the contract is left with only 15 wETH (wrapped Ethereum) to pay the lenders that had 18,000 ETH ($29,160,000) in it just 48 hours ago.

 The funds were investigated on Twitter by researcher NFTStatistics.eth, who emphasised that NFT borrowers on the platform should now pay 100% interest on the ETH they borrowed. Furthermore, debt positioned in opposition to NFTs may be increasing.

 The investigation also found that many of the failing NFTs used as collateral currently have no bids. More NFTs that are due to default and go up for auction are now featured on the platform’s alert list as a result of falling NFT floor prices, growing debt, and excessive interest rates.

 The co-founder of BendDAO claims that their staff is working on a suggestion to change some settings inside the NFT lending system. After being approved through the voting process, the change will take effect 24 hours later.

 A Twitter user took advantage of the catastrophe to poke fun at the system by pointing out that even BendDAO’s co-founder was about to be liquidated by its own loan mechanism.

 BendDAO predicted last week that there would be an upcoming $55 million collection of NFT liquidations to repay loans. According to DoubleQ, the founder of Double Studio, the circumstance may lead to a “death spiral” for the whole NFT market and the Bored Ape Yacht Club (BAYC) ecosystem.

Read more at Cryptoshrypto:

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