Solend overturned a proposal because it went against the core tenets of DeFi apps.
👉 Background: Solend is a decentralised finance (DeFi) app. It lets users borrow and lend funds on the Solana blockchain without going through intermediaries.
👉 What happened: There was a user on the Solend platform that was sitting on a pretty big pile of tokens. They'd deposited around 5.7 million Solana tokens into Solend, which meant they had more than 95% of deposits on the platform. That left Solend very exposed if this user (aka the 'whale') pulled out.
👉 What else: Solend and its community passed a proposal granting it emergency powers to take over the account - a huge deal in the crypto world. But after some pretty significant backlash, Solend’s community voted to overturn the vote, cos it went against the core tenets of DeFi apps.
💡 One of decentralised finance’s core tenets is that it’s meant to distribute power and decision-making from one organisation or individual, to a whole network.
💡 This move by Solend breached the norms of DeFi by using centralised power to control and freeze a member’s funds. By overturning the vote, it looks like a pretty big win for decentralised believers. But there’s one big problem.
💡That one Solend customer could still be in for a massive dump... And this could put pressure on token prices and potentially cause a Celsius-esque bank run. This all highlights how chaotic the crypto world can be... They don't call it the wild west for nothin' 🤠.
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