There is a dap on Solana a product a protocol called solend. The largest lending market on Solana, it is about to have a crippling liquidation of 170 million soul. That would crash the network although Solana is about to 86 percent down from its all-time high. Solana today is at risk of going to zero, I repeat Solana is at risk of going to zero.

Today I talk about Solana if you are unfamiliar Solana is an open-source dap platform and a competitor to Ethereum. The 9th most valued cryptocurrency in existence, Solana is a powerful tool for developers, fast for everyone, and has over 1,000 validator nodes. Its average transaction costs are low, and its network has over 2,000 transactions per second.

Now, if you follow the crypto market every day like I do and if you're familiar with Solana you know that when Solana describes itself as a decentralized blockchain. I could argue a little bit with that. I mean, Helena gets turned off and shut down every once in a while. so that the internal team can fix its problems with Solana. Today Solana is having a major problem although Solana is about to 86 percent down from its all-time high. Solana today is at risk of going to zero. I repeat Solana is at risk of going to zero or was at risk it might be fixed. I'm going to update you on everything you need to know.


What is going on with Solana and cryptocurrency? First of all, there is a dap on Solana a product a protocol called solend the largest lending market on Solana. it is about to have a crippling liquidation of 170 million sold that would crash the network. So people have been watching this there is a large liquidation watch on Solana's soul and protocol. Where a whale has deposited 5.7 million sold about 170 million and then borrowed 108 million stable coins this alone accounts for a huge percentage of borrowing on Solana. Now, this position is under threat of being liquidated. So if a whale who could be liqui­dated is putting the entire protocol in danger of going down, then the Solana folks tried to reach out to the whale to get them to restructure their loan. But it's unclear how the conversa­tion went. But the whale hasn't changed the terms of the loans yet. The whale did not comply this is a problem the whale is not closing their position.

See in most protocols like compound ave maker etc these are the lending protocols. The blue chips on Ethereum will cause on-blockchain liquidation events. These are what is expected to happen. We've witnessed many such significant liquidation events on Ave and Maker recently and everything worked out as expected. However, for Solana, such a large liquidation in an illiquid market and unstable network like Solana is likely to have vastly damaging consequences and this is not hyperbole. Solana network has already gone down and halted a dozen times this year so what will happen to Seoul and the price of a soul? If this position gets liquidated what's about to happen from the sole team themselves? This would cause chaos putting a strain on the Solana network liquidators would be especially active in spamming the liquidation function. Which has been known to be a factor causing Solana to go down in the past letting a liquidation of this size happen on-chain is extremely risky dex. Liquidity isn't deep enough to handle a sale of this size and would cause a cascading liquidation effect.

Read More: What Happens To Bitcoin Holders?

Additionally, liquidators will be incentivized to spam the network in an effort to win a very lucrative liquidation. So there are certain people who want this to happen so they can make money this has been known to cause loads of issues for Solana in the past. This would be exacerbated by the problems at hand so peep this, my friends. So what is the soul and what is Solana going to do to stop this from happening to stop Solana from essentially going to zero in a series of cascading liquidations? Well to prevent this soulland and Solana's team are proposing to literally steal the wales funds and execute otc trades. So somebody had the bright idea that instead of just doing what the contract says. They will take over the position of the whale and liquidate these coins manually through an otc desk. This is unprecedented but it gets better a dao was created specifically to be able to hold a sham vote. Where the system was closed for voting for a long time and then a single large wallet voted yes to this proposal.

To understand the specifics the dao was spun up less than 24 hours ago 98 of the yes votes came from one unidentified whale wallet. They gave their users less than 6 hours to vote on this and the voting site was down for 3 hours of the vote. Wait a minute just so I understand this correctly. One whale has leveraged a huge amount of Solana so much. What if the price drops and this wallet gets forced liquidated it could effectively crash Solana. Is that about right and this whale doesn't look like they're going to cash out. So they want to essentially forcibly seize his Solana and make his cash out. That sounds sub-optimal sounds very centralized authoritarian style of governance of sorts may be the antithesis of crypto. So as a Solana holder it's hard not to have mixed feelings about this because on the one hand, they recognized that what was happening could send the price of Solana down to zero, on the other hand, they just became authoritative and basically reinvented the traditional financial system that we have today.

Congratulations gentle people of soulland you've reinvented tray but with more steps and more frequent and unpredictable interruptions. at this point in time because the gentle people of soulland and Solana stepped in to basically seize the whale's wallets and move the coins manually themselves at this point in time. it doesn't seem like Solana is heading to zero but information on this is coming in by the hour.

In the cryptocurrency space how certain protocols sell themselves as decentralized but when the rubber meets the road they step in and are revealed to be decentralized in name only. Now if you're in the crypto market I don't think any of us ever thought that Solana was very decentralized. that wasn't part of my investor's thesis when I bought it. the fact is you know many protocols can see a lot of success with you know varying degrees of centralization and decentralization. I mean the goal is to get decentralized because if the protocol isn't permissionless. what's the point maybe selling themselves by describing themselves as decentralized right on their website isn't the best and most honest and straightforward definition of what it is. So I think the Solana team essentially did the right thing at the moment not having the project go to zero is optimal. Now they revealed how centralized they are and how authoritative. But again did we think they were that decentralized in the first place. We didn't it's okay for right now barely.

But this or things like this cannot keep happening. If Solana is to have a long-term future we are in a bear market. So the price can always stay low or go a little bit lower depending on what bitcoin and Ethereum do. But I think Solana as a protocol is going to sustain and possibly can still thrive in the future. I mean they're integrated with coin base, they're integrated with open see for alternative layer ones. they're honestly one of the best in the space, especially with partnerships and integrations and developing ecosystems. How can Solana come back, number one do you hold Solana do you think you'd take out a position in Solana? If it got low enough are you still bullish eventually on the future of Solana and do you think that the devs did the right move by stepping in?


Search Tags


crypto currency

solana crashes

crypto currency downs


Post a Comment

Previous Post Next Post