All the Details About BAYC And BendDAO Liquidation Issue!

All the Details About BAYC And BendDAO Liquidation Issue! From the threat of mass liquidation possibly nuking the floor price of BAYC, to possibly being unable to pay back their lenders, here are the latest updates on the BendDAO situation

Threat Of Mass BAYC Liquidation

Earlier this month, it was revealed that a number of NFTs are in threat of being liquidated after being used as collateral on the Ethereum lending platform, BendDAO. In fact, it was also revealed that there is an estimated $55 million worth of NFTs that have been deposited into the BendDAO platform with many of which were reportedly at risk of liquidation.

Many of these NFTs used as collateral were said to be Bored Ape Yacht Club (BAYC) NFTs, with an estimated 272 Bored Apes, representing almost 3% of the entire BAYC collection, tied to the BendDAO platform.

With multiple people possibly unable to pay their loans back to BendDAO due to the current bear market, their Bored Ape NFTs are at risk of being mass liquidated, which could have a detrimental effect to the floor price of the BAYC collection as a whole.

BendDAO Unable To Liquidate

However, another problem has risen since the BendDAO platform began attempting to liquidate these Bored Ape NFTs. Despite already having listed some these BAYC NFTs on marketplaces to sell, many were unable to receive any bids at all.

This has caused more problems as the lending platform now has run out of Wrapped Ether (wETH) in its contract. At the time of writing, it’s reported that BendDAO only has around 15 WETH to pay to its lenders

This means that those who have borrowed ETH from the BendDAO platform will now need to pay 100% interest on the ETH that they borrowed so that the platform will be able to pay back the 15,000 ETH that they owe to the ETH lenders.

The BendDAO platform founders have since revealed that they are working on a proposal to improve the protocol. 

“Writing a proposal to improve the protocol, including some parameters change, will post in the forum today and will effect 24hours after voting, hope that WAGMI.” Co-Founder @CodeInCoffee said on his Twitter.

For more info regarding Crypto Alpha and NFTs Alpha.  Always follow us on Twitter and Instagram



Related post