Hello friends. I just got burnt by a liquidation cascade

Question

Anchor Protocol

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Hello friends. I just got burnt by a liquidation cascade

creating bad debt. What protections does anchor have from that happening to LUNA?

#anchor #cryptocurrency #english

0

13.04.2022

4 ответов

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look up prosocialiseorg Автор вопроса

You clearly don't understand. It doesn't matter what I do. I don't lend LUNA. If a lot of LUNA is lent and it starts to drop, liquidators will dump the LUNA and that can drop LUNA price so as to initiate more liquidations. If enough LUNA is being liquidated the LUNA price can drop too fast for the borrowed UST value to be recovered, leaving some lenders unable to recover their deposited UST.

0

13.04.2022

Mayank Grover (Will never DM first or ask for funds)

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You clearly don't understand. It doesn't matter wh...

Okay but the only way to prevent liquidation is to be in a safe borrow ratio. Also it's totally the responsibility of the borrower to take care of his position.

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13.04.2022

Sir Vandru

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You clearly don't understand. It doesn't matter wh...

Thats not how it works. LUNA is not lent (borrowed) UST is borrowed. If somebody gets liquidated the LUNA they used for collateral gets sold to UST to pay their debt off. If you are worried about cascading liquidations and you check your dashboard every day then dont borrow more then 50% LVT if you dont check it daily dont borrow more then 25%. Also you could use a mix of different assets as collateral to mitigate such events.

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13.04.2022

Mayank Grover (Will never DM first or ask for funds) · Accepted Answer

Mayank Grover (Will never DM first or ask for funds)

Keep your borrow ratio safe by depositing more collateral.

0

13.04.2022

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Hello friends. I just got burnt by a liquidation cascade

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