Curve Finance implements soft liquidation model

Curve Finance (CRV) has introduced a soft liquidation model for loans, allowing collateral not to be immediately sold off in full when entering the liquidation zone. There were 704 instances of this occurring, with a median duration of 14.5 days in the liquidation zone; 25% of positions remained for over 38.9 days, with some lasting months. The soft liquidation mechanism gradually converts collateral into the borrowed asset as prices decline, and if prices recover, some or all of the converted collateral can revert to the original asset. This means that entering the liquidation zone does not guarantee immediate full liquidation. However, losses may still arise from fees, interest, and asset conversions, and continued price drops can lead to complete liquidation.

This content is provided for general informational purposes only and doesn't constitute financial, investment, legal, or tax advice. Any events, rewards, online promotions, or related information mentioned herein should not be considered a recommendation, solicitation, or invitation to purchase, sell, trade, or otherwise deal in any crypto assets. Crypto assets are highly volatile and may result in loss. The availability of WEEX services, products, and related events may vary by region. You are responsible for ensuring that your participation is in accordance with applicable local laws and regulations.