With less than 2 ETH left in the withdrawal pool, can BendDAO get out of the liquidity crisis?
Original author: Punk9059, NFT KOL
Original compilation: wzp, BlockBeats
NFT KOL Punk9059 analyzed the current situation of BendDAO’s liquidity shortage and its reasons today,BlockBeats organizes and translates it as follows:
BendDAO has almost used up ETH deposits , there is only 12.5WETH left in the platform contract. (1.18 WETH as of the end of posting)
What does a shortage of deposits mean?
BendDAO depositors who lent money to others to buy NFTs with leverage will not be able to get their funds back. BendDAO lent approximately 15,000 ETH. At the same time, this also means that borrowers who mortgage NFT must pay almost 100% interest on the ETH they lent. The "debt" generated by NFT mortgage lending is rising rapidly
What it means for blue-chip NFT holders What are you wearing? The impact is that most of the NFTs that were liquidated and auctioned have no bids
13/17 MAYC
5/9 BAYC
8/11 CloneX
6/8 Doodles
(no bid for this series Number of NFTs / Number of NFTs that have already bid)
Deadline for publication
12/17 MAYC
2/3 BAYC
7/8 CloneX
6/8 Doodles
Why did no bidder bid?
(a) BendDAO requires that the bid must be higher than the debt owed by the borrower and higher than 95% of the floor price of the series of NFTs in OpenSea
(b) Bidders must lock ETH for 48 hours during the Open Auction. In some cases, the NFT floor price will fall below the debt of the borrower, and the bidder does not want to bear the risk of the NFT floor price falling within 48 hours.
There are still many mortgaged NFTs that will soon be liquidation auction, either because of mortgage lending rates causing borrower debt to rise, or OpenSea floor prices falling. These NFTs are currently being auctioned on the BendDAO platform instead of the NFT trading platform because there are no bidders. BendDAO is forced to hold a large number of NFTs. Ultimately, however, BendDAO needs to sell NFTs for ETH to repay depositors, who are now unable to get their funds back.
So we'll have to wait and see how BendDAO will figure it out
(a) Are they holding these blue chip NFTs and waiting for the floor price to recover?
(b) Or will they change the terms of the agreement (the bidder’s bid does not need to be greater than the borrower’s debt or reduce the proportion of the bid to the NFT floor price, which is currently is 95%) to make it easier for BendDAO to sell NFT to withdraw ETH funds?
(c) Can they find market makers who are willing to buy NFTs and then Sell at a discount?
It needs to be reminded that as long as a large number of NFTs are still in the auction stage without bidding, the NFT market price will not reflect immediately. let us wait and see. Hopefully the market will get through it and learn from it.
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