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HomeNewsCurve DAO’s Michael Egorov Faces $140M Liquidation Threat

Curve DAO’s Michael Egorov Faces $140M Liquidation Threat

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  • Egorov faces $140 million in CRV liquidation, owing $95.7 million in stablecoins.
  • CRV exchange balances surged by 57% in four hours amid market turmoil.

A few hours after word leaked out that Curve DAO (CRV) founder Michael Egorov may be facing insolvency, the price of the cryptocurrency fell by up to 35%. The decentralized finance (DeFi) industry is reeling from this sharp decline, which has rattled stakeholders’ and investors’ trust.

Egorov’s Precarious Position

A key player in the DeFi industry, Michael Egorov, is presently negotiating a volatile trade environment. On-chain analysis site Arkham reports that Egorov’s CRV is about to be liquidated for $140 million.

Against $141 million in CRV split over five accounts on different lending protocols, he has borrowed about $95.7 million in stablecoins, mostly crvUSD.

“Based on current rates, Egorov is paying $60 million annually to keep his positions open on Llamalend,” Arkham said, underscoring his financial difficulties.

High-Interest Borrowing

High interest rates on Egorov’s borrowings make his financial problems much worse. Using the DeFi platform Llamalend, he borrowed $50 million at an APY of about 120%.

Most of the reason for this outrageous cost is that there is hardly any CRV available on Llamalend to borrow against CRV. Remarkably, over 90% of the crvUSD borrowed on this protocol comes from three of Egorov’s accounts.

Spot On Chain data on collateral and debt shows that Egorov now owes $27 million across three platforms and has 139 million CRV coins worth $37 million as collateral. The serious leverage emphasises how precarious his financial situation is.

Source: Spot On Chain

The declining price of CRV has also had an impact on other significant market participants. A liquidation on Fraxlend, for example, forced crypto whale 0xF07 to send 29.62 million CRV, or almost $7.68 million, to Binance.

Exchange Balances Surge

founder of another on-chain monitoring site, Ki Young Ju, saw an unprecedented rise in the CRV balance on exchanges. In just four hours, it climbed 57%, suggesting a potential sell-off as investors fumble to reduce their risks.

Source: CryptoQuant
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Syofri
Syofri
Syofri is an active forex and crypto trader who has been diligently writing the latest news related to the digital asset sector for the past six years. He enjoys maintaining a balance between investing, playing music, and observing how the world evolves. Business Email: info@ethnews.com Phone: +49 160 92211628
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