A lending platform based on the Solana blockchain, Solend, attempted to seize control of its largest account, called “whale” investor who it said had substantial market influence.
A single whale, according to Solend, is sitting on an “extremely large margin position,” putting the protocol and its users in jeopardy. “In the worst case, Solend could end up with bad debt, this could cause chaos, putting a strain on the Solana network.” The business cautioned.
Solend is a DeFi software that allows users to borrow and lend money without the use of agents.
Solend passed a motion on Sunday that gave it emergency powers to take over the whale account, a first in the DeFi world.
Solend claimed that if the price of sol falls below $22.30, 20 percent of the account’s collateral — around $21 million — will be liquidated. On Monday, Sol was trading at $34.49.
To avoid a possible cascade of liquidations, Solend stated the strategy would allow it to liquidate the whale’s assets via “over-the-counter” transactions rather than on-exchange deals.
To avoid collapse of the system, a crypto lending app took control of a whale account
