Solend nullifies Solana whale wallet takeover plan second governance

Solend nullifies Solana whale wallet takeover

plan with second governance vote Solend, Solana-based decentralized finance (DeFi) lending system, has developed a new governance vote to nullify a recently-approved proposal that grants Solend Labs "emergency powers" to access a whale's wallet in order to escape liquidation.

The crypto lending platform launched a governance vote on Sunday titled "SLND1: Whale Risk Mitigation." This allows Solend to lessen the market risk associated with the whale's liquidation by allowing the lending platform access to the whale's wallet and allowing the liquidations to take place over-the-counter (OTC).

If the price of Solana (SOL) declines and the whale is liquidated, the lending platform may "end up with bad debt" and burden the Solana network, according to Solend. Members of the neighborhood were outraged when the idea was accepted.

The Solend team conducted a second governance proposal vote to nullify the previously-approved plan as the community denounced the action, calling it the polar opposite of what DeFi should be and simply unlawful. With 1,480,264 votes in support of dismissing the SLND1 proposal, the proposition was defeated.

The new proposal nullifies the earlier vote and requires Solend to find an alternative to forcibly taking over an account. It also shortens the time it takes to vote on governance to one day.

The scenario has placed the crypto lending platform in a difficult position. Solend might be able to save SOL from a DeFi collapse if he can take over the whale's wallet and get emergency powers. However, this demonstrates that anyone's assets can be seized within the network, perhaps leading to a boycott.

On the other side, some predict that if the Solend team is unable to address the concerns surrounding the whale's account, it will cause a Solana meltdown, leading SOL's price to plummet.

While at the time of writing SOL is trading at $32.22, it shows an increase of 10.84% in the last 24 hours and 16.90% in the last 7 days.