Risks of On-Chain Liquidations in DeFi Sector

Written byEthan LimWriter

Introduction

The DeFi sector has experienced a successful month, but it is not without risks. One of the main concerns is the potential for on-chain liquidations triggered by a decline in the price of ETH.

On-Chain Liquidations

Currently, there is a $76.2 million position on Aave that will be liquidated if ETH crosses $1,777. Additionally, if the price falls by 20%, over $100 million will be liquidated.

Conclusion

While the DeFi sector has seen positive growth, it is important to be aware of the risks involved. Triggers such as a slight slide in the price of ETH can lead to significant on-chain liquidations. Investors should stay informed and take necessary precautions to mitigate these risks.

About the author

Ethan Lim

About

Ethan Lim, a native of the Lion City, is Singapore’s rising star in the domain of online casino guide localization. He masterfully blends his intimate knowledge of local culture with international gaming standards to produce content that resonates deeply with Singaporeans.

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