150 million USD loan – extremely high liquidation risk
At the same time, WLFI has also been criticized for implementing a complex loan structure on the Dolomite platform:
Collateral ~5 billion WLFI (~400 million USD)
Borrowing about 150 million USD stablecoin
Using a "looping" model to maximize leverage
The issue is: the amount of collateral is 4 times the market liquidity, making liquidation nearly impossible if prices continue to fall.
Experts warn that if WLFI drops another ~75%, the system could face large-scale bad debts, posing risks to the entire ecosystem.
In summary, WLFI is a prime example of modern DeFi risk:
non-transparent smart contracts + high leverage + weak liquidity = chain collapse risk.
#binanceaipro $XAU
At the same time, WLFI has also been criticized for implementing a complex loan structure on the Dolomite platform:
Collateral ~5 billion WLFI (~400 million USD)
Borrowing about 150 million USD stablecoin
Using a "looping" model to maximize leverage
The issue is: the amount of collateral is 4 times the market liquidity, making liquidation nearly impossible if prices continue to fall.
Experts warn that if WLFI drops another ~75%, the system could face large-scale bad debts, posing risks to the entire ecosystem.
In summary, WLFI is a prime example of modern DeFi risk:
non-transparent smart contracts + high leverage + weak liquidity = chain collapse risk.
#binanceaipro $XAU