Curve Finance founder Michael Egorov has put forward a new way of dealing with roughly $700,000 in bad debt on LlamaLend, arguing that the issue should be resolved through market pricing rather than a protocol bailout. The proposal introduces a structure that resembles an options-style payoff, allowing the debt to be traded and absorbed by market participants instead of being socialised across users. The idea arrives at a time when DeFi lending platforms continue to face pressure over how to handle liquidation shortfalls without weakening trust in governance systems or placing sudden losses on token holders.
Source: Read the original article
