salon2/squeeze

[utterances-bot]

How to Avoid DeFi Liquidity Squeezes | OneTrueKirk

Ethereum, cryptoeconomics, governance

https://onetruekirk.github.io/salon2/squeeze.html

[jfarid27]

This is an interesting approach. On first glance I would expect lending terms should have a possible fixed ending time, but after some thought, I cannot see how this can't be griefed without losses to lenders. It would be interesting if a griefer called the loan right before the lending term expiry just to give losses to lenders. I'm not sure of specifics or how this would work in practice, but if there was a way to prevent this griefing, I would be interested in deploying fixed term auctions like the U.S. Treasury, where during their operations, they produce tranches of debt at specific rates and allow participants to bid until filled.