Michael Mueller

@maplefinance

[Maple @maplefinance]

Core Foundation and Maple have reached a full and final settlement - all claims mutually released. The path forward is clear, the focus returns to launching syrupBTC and growing onchain capital markets. Onward.

Full release here: https://t.co/YboXnMcnCA

[Maple @maplefinance]

(1/7) Update from Maple

Maple has no active DeFi positions. We assessed risk exposure across DeFi and proactively removed all allocations. Through active risk management, Lenders have no exposure to rsETH or other indirect exposures, and the Maple platform operated as expected.

[Duo Nine ⚡ YCC @duonine]

🚨 I don't think people realize how bad things are at @aave right now.

All core markets are at 100% utilization, that includes $3 bil in USDT and $2 bil in USDC stuck!

That means you CAN'T WITHDRAW your money!

A long post on why and how we ended up here.

When the rsETH exploit happened and AAVE incurred bad debt, whales like Justin Sun, MEXC exchange, and others immediately withdrew billions from AAVE.

This instantly drained all available liquidity in key core markets like ETH, USDT, USDC and so on. Those first to withdraw got out, laggers got trapped.

Initially, the ETH market hit 100% utilization, meaning you could not withdraw your ETH from AAVE.

Worse, this also means the protocol can't process ETH liquidations should ETH price fall/crash. If you can't sell any ETH, you can't liquidate to cover debt obligations.

That means the risk of more bad debt incurred by AAVE is increasing the longer its markets remain stuck.

Nevertheless, users can still sell at a minor loss the aETHwETH tokens on Uniswap or similar aggregators. That exit door is the last one remaining for ETH depositors on AAVE.

The same cannot be said by depositors of USDT and USDC. They are stuck.

That's because AAVE lost over $6 billion in liquidity in the past 24h. As whales took out their money, USDT and USDC also hit 100% utilization.

These markets are now also stuck with money locked. Panic is spreading and desperate times call for desperate measures.

Some users decided to borrow against USDT/USDC and exit via other markets at a 10-25% loss (90-75% LTV). Basically you borrow GHO/DAI/USDe against your locked USDT/C.

But as more liquidity leaves AAVE, more markets get to 100% utilization and get locked/stuck due to low liquidity. This is quickly cascading across all available markets.

Luckily the crypto market was rather flat today so liquidation risks were marginal, but if things change there are billions in stablecoins and other assets locked on AAVE that can't process liquidations = more bad debt for AAVE.

If users or related protocols that are stuck need access to their money to prevent liquidations or other critical function, they have a huge problem on their hands.

Plus, nobody wants to deposit (or provide liquidity) in these markets now since your ETH, BTC, USDC/T could be stuck there for who know how long.

As soon as any available liquidity is made available, it is instantly taken out by bots fighting to get out. As I wrote this I saw 250k in liquidity on USDC vanish in seconds.

Then there is the bad debt question.

There's over $200 mil in bad debt incurred by AAVE via rsETH that's like a hot potato. Nobody knows who will eventually pay this bill.

If you didn't remove your assets from AAVE, you risk receiving at least part of that bill in some form. Not having access to your money is part of that risk too.

Contagion is also extremely high.

Many protocols and apps rely on AAVE for their earn mechanics. These protocols and their users are stuck too and may be forced to incur bad debt with no fault of their own.

October 10th was a CEX driven crash, this is a DeFi risk mitigation failure of epic proportions.

AAVE should have never onboarded rsETH as a collateral asset, at least not to the size of hundreds of millions that allowed the hacker to walk away (i.e. borrow) over $200M in ETH after posting fake collateral.

Rumors on X are saying rsETH was onboarded by AAVE due to a conflict of interest (lobbying) by a given service provider. If true, this is a major failure of its governance structure (nothing new).

The folks at @KelpDAO who manage rsETH also have a tough decision to make on who will actually pay for the $200M exploit. AAVE users? L2 rsETH users? Everyone affected gets a haircut to account for the loss?

The AAVE team and its founder, Stani, have been quiet for over 20h since the exploit after initially announcing the rsETH market freeze.

They have a pretty big problem on their hands since the whole protocol is at risk right now. Trust is already lost as AAVE is bleeding billions in TVL to the level of hitting 100% utilization on all core markets.

Maybe some key actors in the space will step in to provide liquidity to stabilize the markets on AAVE before this gets even worse.

I got lucky to get out of AAVE early when I first saw this. I also removed all assets from DeFi and will not touch any protocol in the next few weeks. Too much risk for a few percentage points in yield.

If you found this informative, like, share, and follow @duonine

[Michael Mueller @michaelbcn]

@burkov Yeah 1999 “powered by the internet” vibes

[Maple @maplefinance]

https://t.co/YLFUXaXdZT

[Maple @maplefinance]

The next era of DeFi starts today.

@Aave and Maple are establishing a strategic partnership that brings institutional assets to the largest onchain lending market.

[Bloomberg @business]

Cantor Fitzgerald officially kicked off a $2 billion Bitcoin-backed lending program with financing deals for FalconX and Maple Finance https://t.co/qU9yZtlmnl

[Michael Mueller @michaelbcn]

@jessepollak @base @CoinbaseWallet Increased focus on institutions

[Michael Mueller @michaelbcn]

@chad_evm @lucasmanuel_eth @Rabby_io @Trezor This post mortem talks about compromised signers managing their Ledgers via Rabby, mentions a compromised Trezor too (managed with Frame) https://t.co/LypKjBkdwS

[Austin Barack @AustinBarack]

$MPL up 48% from the Monday lows. Probably the most overlooked RWA protocol. Sub $200MM FDV, consistent and accelerating growth, and $3MM+ ARR. I think the disconnect is people don't realize how much the product has evolved in the last 2 years. Worth a refresh to get up to date

[Syrup @syrupfi]

⚡ Announcing Syrup — a new protocol unlocking Institutional Yield:

🟠 Real yield through secured lending
🟠 Seamless DeFi access
🟠 Powered by @maplefinance
🟠 Earn yield + Drips rewards

➡️ Get early access: https://t.co/WJR3A6RsCv

[Maple @maplefinance]

🥞 Why should lenders choose Maple over @Aave
and other DeFi Lending Protocols?

A: Higher yields and lower rate volatility 

⬇️ A detailed analysis below: 

📈 Lenders in the High Yield Secured pool have earned 17% APY since early March, while USDC lenders in @Aave v3 earned 10.3% APY over the same timeframe.

🟢 High Yield Secured Lending
Deposit: 1MM USDC
Launch date: 6 March 2024
Yield difference: 17% net APY vs. 10.3% in @aave v3
Outperformance: 66%
Additional Return: 10,050 USDC 

📈 The Blue Chip Secured pool, which has been live since August 2023 - has significantly outperformed as well since launch.

🔵 Blue Chip Secured Lending
Deposit: 1MM USDC
Launch date: 8 August 2023
Yield difference: 8.8% net APY vs. 6.8% in @aave v3
Outperformance: 33%
Additional Return: 16,592 USDC

Maple’s unique lending strategy provides much more stable yield generation for lenders. Maple Direct issues fixed rate overcollateralized loans vs. the utilization based model which leads to fluctuations in yield for both lenders and borrowers.

As lenders started to recognize this in the last 2 weeks, TVL has doubled in the Maple Secured pools and loan originations have now surpassed 170MM.

➡️Get access here: https://t.co/jsvgq52PbQ

[Michael Mueller @michaelbcn]

@alancarroII Is this you @fat_mac2

[Michael Mueller @michaelbcn]

@WalletConnect can you please confirm if you are experiencing any outages in connecting to v2?

[Paul Mangione @paul__mangione]

Crypto Firms Shift to Safety, Buy Treasurys

#DeFi firms like @maplefinance are basically giving Stablecoin holders the ability to earn the risk free rate

Also allows non US investors get access to UST

Long term tokenized funds can serve this purpose

[Michael Mueller @michaelbcn]

When we want AI to manage our finances, what’s it going to use? Sure, you’ll be able to hook up a bank account to handle simple transfers… but for setting up more complex flows where we need visibility and control over what it does, smart contracts make more sense

[Michael Mueller @michaelbcn]

Hope for humans: AI without GAI will always have an Achilles heel (that you need another AI to find) https://t.co/Mwu5FKde5X

[Michael Mueller @michaelbcn]

Legend!

[Lucas Manuel ⚡ @lucasmanuel_eth]

Today is a big day for @maplefinance - we have open sourced all of our smart contract repositories and have published our documentation.

Time for a long thread 👀

[Michael Mueller @michaelbcn]

@areanc Ah querida España, me recuerda a ese vídeo, que no dista mucho de la realidad https://t.co/0CWDVABcfF

[Michael Mueller @michaelbcn]

@lucasmanuel_eth Vegans?