![]() ![]() DeFi giant MakerDAO went underwater $4MĪccording to a blog post by Maker, MakerDAO, one of the largest Ethereum's DeFi applications faced an emergency shutdown as its under-collateralized debt reached over $4 million.Īt about eight o'clock in the evening, the CoinLoan team kept communicating with customers, checking the numbers and functionality of the platform.Holding up so far, monitoring all systems.ĭue to a temporary network issue, withdrawals and deposits of #ETH and #ERC20 tokens have been delayed for about two hours. Overall 5x system load than all previous peaks. some futures ADL and margin calls, no cyclic crashes. futures UI 500 errors for a few minutes, fixed spot depth push experienced some delays, fixed Unfortunately, many crypto-companies have not escaped the technical issues. Many loans have been liquidated due to rapid price changes, but the big part was saved thanks to the fast reaction of borrowers in cooperation with CoinLoan's support team. The platform never had a single case of failure during the 12th of March. For instance, we accelerated and accepted deposits manually before the network confirmed them during the “traffic jam.”ĬoinLoan's infrastructure coped with its job. We received dozens of requests in support and did everything in our power to avert liquidations and avoid the platform breakdowns. It was a high-stress moment for the team. Such a flow required only a minute while the Ethereum network could detain transactions for close to an hour. To make rapid deposits, some users transferred fiat to the platform via Visa/MasterCard and changed it into crypto directly on CoinLoan. In particular, many CoinLoaners used our new feature to make repayments with collateral before it was devalued even more. ![]() The alternative solution was to prepay the loan ahead. Users were wasting their precious time needed to protect loans from zeroing. For users, this meant that a transaction either became very expensive or took a very long time to be written into the blockchain until prices correct even more. Many exchanges experienced some form of infrastructure problems during the price crash. Average time for confirmations 2680 seconds (44 minutes) /nPENzWA4yH- CZ Binance □□□ March 12, 2020 ![]() The average cost of an ETH transaction has risen to $0.58, with confirmation taking up to 44 minutes. A massive amount of panic selling has overloaded the Ethereum network to a degree not seen in a year. To avoid liquidation, users deposited crypto to the platform to add more collateral. However, some investors didn't have time to react during the free fall. There were no totally sudden ones, as all clients got their margin calls that morning. When the market value of collateral plunged, it brought the first wave of liquidations on CoinLoan. Other cryptocurrencies fell greatly as well. For the whole day, Bitcoin lost 31.5% of its value. 12:30-12:50 (UTC +2), Bitcoin CrashesĪt some point around noon, Bitcoin sharply dropped 21% from $7,356 to $5,796 in about twenty minutes. Users had a few hours to react to those early notifications the ones who strengthened their positions at that point significantly increased their chances when the market went into a tailspin. Clients got first margin call notifications asking to add more collateral. Black Thursday Chart showing the 12.03 daily move, from Coindesk Starting From 8 AM (UTC +2), Bitcoin Prices Begin to Decline GraduallyĬoinLoans’ internal system has notified the team that many loans start to fall into liquidation risk status (over ~80% LTV) one by one. If you consider that much of our personal growth comes from the most painful events in our lives, we could even look at turbulent times as the most excellent learning opportunities. Moreover, we’re happy we could help some users that have been caught off guard. Despite temporal dysfunctions within the crypto market, the team has successfully coped with all challenges. The story from the inside of CoinLoan includes margin calls, sleepless nights, and delayed transactions. Read how the crypto-lending industry was on thin ice struggling to manage tons of margin calls at once and help thousands of users to avoid collateral liquidations. We tell you the story of the financial disaster that will be recorded in the history of crypto as the largest single-day drop. March 12th and 13th, 2020, will be remembered as days that brought the most significant stress test to the crypto-lending ecosystem and the whole financial market. ![]()
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