Lido Lend, a lending protocol proposed by Lido contributors and derived from Morpho Blue, would let lenders reduce borrowers’ positions before liquidation through fallback exits. Withdrawal shortfalls would be covered with borrower collateral and the corresponding debt reduced, with positions closest to liquidation treated first. Eligibility rules for healthy positions, collateral valuation, the debt-offset formula, fees, and limits remain to be determined. Lenders would receive transferable wstETH, which they would need to sell on the market or convert into ETH through Lido’s existing withdrawal queue, where each request is capped at 1,000 stETH and larger requests must be split into multiple requests.
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