Once again it looks like the overleveraged have come back to haunt us

Im honestly so tired of this, its really just so incredibly frustrating that once again it looks like someone swimming naked has pissed the pool for the rest of us. Im sure some if not most of you have heard of the recent Curve exploit that occurred, but i dont think everyone realizes the contagion that it could have on crypto. Its a top 5 defi protocol up there with Aave and Uniswap with ~3B in TVL. That is it did up until 3 days ago, where it has now been halved. Fair game, a hack is a hack. It can survive. Youd think life would go on, Curve would limp along maybe recover maybe not but no we still have Michael Egorov to worry about. Egorov is a founder/CEO of Curve Finance, hes a very smart man who likes expensive things. Hes got several positions on multiple protocols like Abracadabra, Aave, Fraxlend, etc. adding up to several hundreds of millions of dollars mostly propped up by the Curve token. Curve is not a shitcoin rug, its a long-standing defi protocol thats earned high grade collateral ratings throughout the lending space. Only until it gets abused by greed, and someone gets exposed and puts it at risk of becoming a shitcoin rug. We have a situation now with a possible death spiral. Michael can be seen on-chain frantically selling pockets of LDO, USDT, FRAX, BTC, CRV and making his own curve pools with high APY to scrounge liquidity. This causes panic selling, mass exits from LPs and people exiting positions. Headhunters are coming for Michael’s scalp trying to liquidate his positions and more than likely send Curve to 0 in the process. This was attempted by that Avi Eisenberg several months ago but didnt come nearly this close, but borrow rates on Egorov’s positons have become unsustainable to the point where he needs tens of millions in less than a week to maintain sufficient collateral. He will likely be liquidated, Curve will likely go boom in the process, ripples throughout defi will follow, we go back down, pain. We never learn. submitted by /u/marsangelo [link] [comments]
http://dlvr.it/St24ll