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Curve Founder Faces Liquidation Risk on DeFi Loan
Michael Egorov, the founder of the decentralized finance protocol Curve (CRV), is once again nearing liquidation on his massive DeFi loan as the crypto market experienced a significant downturn over the weekend.
Bitcoin and Altcoin Decline
Bitcoin’s price has dropped by 10% since Saturday, with altcoins like CRV being hit even harder, declining by 30% from $0.58 to $0.43 during the same period. At its lowest point on Saturday, the token fell to just $0.38, dangerously close to Egorov’s liquidation threshold of $0.37.
Lending Health Concerns
According to EmberCN on Twitter, the lending health rate of multiple positions has dropped to around 1.1, indicating the risk of liquidation if the CRV price continues to decline by 10% without margin calls or repayments.
Loan Details
Egorov has supplied 371 million CRV tokens (approximately $156 million) to borrow $92.5 million in stablecoins across 5 addresses on 6 different DeFi lending platforms. To avoid liquidation, he needs to increase his collateral base with more CRV or repay some of his debt.
Protective Measures
In the past, Egorov has sought assistance from various crypto industry leaders to raise funds and safeguard his position. Notably, Tron founder Justin Sun purchased 5 million CRV from Egorov at $0.40 each. Additionally, Egorov engaged in over-the-counter (OTC) deals to raise $15.8 million by selling 39.2 million CRV.
Market Impact
CRV’s trading volume remains relatively low, with only $85 million processed in the past 24 hours and a market cap slightly above $500 million. The potential liquidation of Egorov’s CRV holdings could lead to a significant price drop.
Crypto Liquidations
During April 13 and 14, crypto traders experienced over $1.5 billion in liquidations, including short traders who lost $273 million amid market volatility. Decentralized exchanges witnessed $120 million in liquidations during this period.
Ian is a cryptocurrency enthusiast blending humor with professionalism. With an engineering background and a storyteller's heart, he simplifies the blockchain world with sharp analysis and a touch of wit. At Cryptowire, he brings his unique perspective to make digital financial innovation accessible to all.
