Whale skeleton, text asking is Solana will go extinct now that whale hunting is no longer allowed?

Solana in trouble? Solends decision to take over wale wallet gets reversed

By Patch | Things of note and other interesting stuff | 21 Jun 2022

Solend a lending platform put up a proposal dubbed: SLND1: Mitigate Risk From Whale, last Sunday. And with very little notice to the community, the vote was passed that day, with 1,155,431 yes votes to 30,101 no votes. Now what? Is it wale hunting season?

What did the proposal mean?

Solend has one of the wale wallets that was heavily invested in Solana and had borrowed against these assets, while this usually is no problem. Circumstances have it that Solana has dropped pretty drastically in price as of late. More than other cryptos. This meant that if Solana would fall below $22.30. This wallet's position would become target for liquidation, at roughly 20% of their borrowed amount. Or roughly 21 million.

If this would happen Solend could end up with what they call bad debt. And this would then cause further liquidation of other borrowed positions. Causing a chain reaction. And this would ultimately put immense pressure on Solana. Many feared it could cause mass panic and Solana to drop down to $0. Being the second Blockchain to fall during this bear market. TERRA being the first.

The problem was that the owner of this wallet have been online for 12 days leading up to the proposal. And all attempts to get a hold of the person had failed. So they have now resorted to this vote. And if the vote passed it would give them emergency power to temporarily take control of the wallet. And be able to liquidate it OTC, Over The Counter. Or simply put sell it from the back door, that way it would not affect the overall price of Solana.

You can see the proposal in full and the content of the wallet if you follow the link down below.

The vote passed, now what?

And because the vote was not promoted, and the DAO appears to have a very short voting time. It was well under 24 hours. The vote passed. With 1,155,431 yes votes to 30,101 no. The interesting this here is that 1,014,210 of the yes votes came from the Solend DAO.

This did not sit very well with the DeFi community. As this is the sort of thing that DeFi aims to avoid. Many were complaining that basically, they could put up anything for a vote and not tell anyone and just vote it through. Ultimately taking over the entire Blockchain if they would want to.

This is despite the very fact that the vote ultimately was done to try and save the Blockchain, so for once it was not a bad actor trying to take over everything. But I still understand why people where opposed it.

A new vote was put in place called: SLND2: Invalidate SLND1 and Increase Voting Time. This proposal is proposing to undo the last proposal, SLND1, and also increase the voting time to 24 hours. Allowing more people to participate. This vote also passed with 1,480,264 yes votes to 3,535 no. The Solend DAO still having the clear majority of votes. The proposal in its entirety can be viewed down below in the links as well.

We undid it all, but the ship is still on fire...

Solend has now put forth a new third proposal, called: SLND3: Introduce Account Borrow Limit. In short, they are proposing a few temporary changes to try and avoid the aforementioned disaster. Sadly these changes do rely on people playing ball and not taking advantage of the clear loopholes.

There is still time to go vote and make your voice here regarding this proposal and any other possible solutions. You can find the proposal here, or down below in the link section. So go and vote now!

You can say many things about Solend, but you can not say that they do not listen to the Solana community or that they do not care. Sadly these things might not always be enough and we might have to say goodbye to the Solana Blockchain in a worst-case scenario. But let us hope that it will not come to that because we have had enough shit happen in this bear market to last us a lifetime.

What do you think of this whole Solend / Solana situation? Will this be Solanas swansong, or is it an "if it does not kill you it makes you stronger" moment? Please share your thoughts on this down below in the comment section.

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