There is a dap on Solana with a product and a protocol called Solend. The largest lending market on Solana is about to have a crippling liquidation of 170 million SOL that would crash the network. Although Solana is currently down about 86% from its all-time high, it is on the verge of going to zero. I repeat, Solana is at risk of going to zero. If you want to become a trader, and you are not sure if you can make the decision right, use Jet-Bot copy trading platform to reduce the risks. Taking advantage of this can benefit you greatly. You may copy best traders, get crypto passive income and feel free.

What is Solana?

If you are unfamiliar, Solana is an open source dApp platform and a competitor to Ethereum, the ninth most valuable cryptocurrency by market cap in existence. A powerful tool for developers, Solana is a decentralized blockchain built to enable scalable, user-friendly apps and dApps for the world with over 2000 transactions per second and over 79 billion total transactions. The average cost of a transaction is cheap, and they have over 1,000 validator nodes.

If you follow the crypto market every day like we do, If you’re familiar with Solana, you know that when Solana describes itself as a decentralized blockchain. We could argue a little bit with that. I mean, the fact is, Solana gets turned off and shut down every once in a while so that the internal team can fix the problems with Solana. So it is what it is.

Solana Price At RISK Of Going To ZERO!?

Today Solana is having a major problem. Although Solana is currently down about 86% from its all-time high, it is on the verge of going to zero. I repeat, Solana is, or was, at risk of going to zero. It might be fixed.

The Problem (Cascading liquidation threat)

Let me clue you in to what is going on with Solana and cryptocurrency. First of all, there is a dap on Solana with a product and a protocol called Solend. The largest lending market on Solana is about to have a crippling liquidation of $170 million SOL that would crash the network. So people have been watching this. There is a large liquidation watch on Solana’s soul and protocol where a whale has deposited $5.7 million, sold about $170 million, and then borrowed 108 million stable coins. Solana borrowing accounts for a huge percentage of the total. This position is under liquidation threat, so a whale that could get liquidated is putting the whole protocol at risk of going to zero.

The whale did not comply. This is a problem. The whale is not closing their position. As seen in most protocols like Compound, Aave, Maker etc. These are the lending protocols, the blue chips on ethereum. This will result in on-chain liquidations. That’s what’s supposed to happen. In fact, we have seen many such large liquidations on Aave and Maker recently, and everything worked out as expected.

However, for Solana, such a large liquidation in an illiquid market and an unstable network like Solana’s is likely to have vastly damaging consequences. This is not hyperbole. Solana’s network has already gone down and halted a dozen times this year.

IF the whale position gets liquidated THIS WILL HAPPEN

So what will happen to SOL and the price of soul if this position gets liquidated like what’s about to happen? From the SOL team themselves, this would cause chaos, putting a strain on the Solana network, liquidators would be especially active in spamming the liquidation function, which has been known to be a factor causing Solana to go down in the past. Letting a liquidation of this size happen on the chain is extremely risky. The DEX liquidity isn’t deep enough to handle a sale of this size and would cause a cascading liquidation effect. Additionally, liquidators will be incentivized to spam the network in an effort to win a very lucrative liquidation. There are certain people who want this to happen. They can make money. This has been known to cause loads of issues for Solana in the past, which would be exacerbated by the problems at hand, so peep this my friends.

Solana teams decide to STEAL coins from the whale (DAO info)

So what is SOL and what is Solana going to do to stop this from happening? To stop Solana from essentially going to zero in a series of cascading liquidations. Well, to prevent this, the Solend Labs and Solana team are proposing to literally steal the whale funds and execute OTC trades.

As a Solana holder, it’s difficult not to feel conflicted about this because, on the one hand, they recognized that what was happening could drive the price of Solana to zero. On the other hand, they just became authoritative and basically reinvented the traditional financial system that we have today.

At this point in time, because the gentle people of Solend and Solana stepped in to basically seize the whale’s wallets and move the coins manually themselves, at this point in time, it doesn’t seem like Solana is heading to zero, but information on this is coming in by the hour.

Decentralized in name only

This again highlights a problem in the cryptocurrency space:

If you’re in the crypto market, I don’t think any of us ever thought that Solana was very decentralized. That wasn’t part of my investor thesis when I bought it. The fact is, you know, many protocols can see a lot of success with, you know, varying degrees of centralization and decentralization. I mean, the goal is to get decentralized because if the protocol isn’t permissionless, what’s the point? Maybe selling themselves, describing themselves as decentralized right on their website isn’t the best and most honest and straightforward definition of what it is.

Will Solana be ok?

In my opinion, I think the Solana team essentially did the right thing in the moment. Not having the project go to zero is optimal now. They revealed how centralized they are and how authoritative they are, but again, did we think they were that decentralized in the first place? We didn’t. It’s okay for right now, barely, but things like this cannot keep happening if Solana is to have a long-term future. We are in a bear market, so the price can always stay low or go a little bit lower depending on what bitcoin and ethereum do, but I think Solana as a protocol is going to sustain and possibly thrive in the future. I mean, they’re integrated with Coinbase. They’re integrated with OpenSea. For alternative layer ones, they’re honestly one of the best in the space, especially with partnerships and integrations and developing ecosystems. Solana is up today as well. Crazy times.

Do you hold a Solana? Do you think you’d take out a position in Solana if it got low enough? Are you still optimistic about Solana’s future? Do you think that the developers made the right move by stepping in?

[This article is a transcription of a video made by Altcoin Daily]

Original video: ]