Solend invalidates Solana whale wallet takeover plan with second governance vote

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Solana-based Decentralized Lending (DeFi) Protocol created another vote on governance to overturn a recently approved proposal that gave Solend Labs “emergency powers” to access a whale wallet to avoid liquidation.

On Sunday, the crypto-lending platform launched a governance vote titled “SLND1: Mitigating Whale Risk.” It allowed Solend to reduce the risks posed to the market by whale liquidations by allowing the lending platform to access the whale’s wallet and allowing liquidations to limit over-the-counter.

According to Solend, if the price of SOL drops and the whale liquidates, the platform could “end up bad debt” and put pressure on the Solana network. The proposal was approved, prompting criticism from community members.

After the community condemned the move, calling it the opposite of what DeFi should be and completely illegal, Solend’s team began a second vote on the governance proposal to invalidate the previously approved proposal. The motion ended with 1,480,264 votes in favor to ignore SLND1’s motion.

The new proposal invalidates the previous vote and will prompt Solend to find another solution that does not involve taking over an account by force. In addition, it also increases the time for voting on governance by one day.

RELATED: SOL Price Heads For Yearly Lower As Solana TVL Drops $870 Million In Three Days

This situation has put the cryptocurrency lending platform in a terrible dilemma. If Solend takes over the whale wallet and is granted emergency powers, it could save Solana from an internal DeFi explosion. However, it will show that the assets of anyone within the platform can be confiscated and can cause a boycott. Cryptokk.eth tweeted:

On the other hand, if the Solend team is not able to mitigate the risks surrounding the whale account, some believe it could lead to Solana’s collapse, causing the SOL price to sink significantly.

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