Saturday, May 24, 2025
No Result
View All Result
Coins League
  • Home
  • Bitcoin
  • Crypto Updates
    • Crypto Updates
    • Altcoin
    • Ethereum
    • Crypto Exchanges
  • Blockchain
  • NFT
  • DeFi
  • Metaverse
  • Web3
  • Scam Alert
  • Regulations
  • Analysis
Marketcap
  • Home
  • Bitcoin
  • Crypto Updates
    • Crypto Updates
    • Altcoin
    • Ethereum
    • Crypto Exchanges
  • Blockchain
  • NFT
  • DeFi
  • Metaverse
  • Web3
  • Scam Alert
  • Regulations
  • Analysis
No Result
View All Result
Coins League
No Result
View All Result

Renzo’s ezETH token depeg triggers liquidations across DeFi platforms

April 24, 2024
in Ethereum
Reading Time: 2 mins read
0 0
A A
0
Home Ethereum
Share on FacebookShare on TwitterShare on E Mail



Renzo’s liquid restaking token (LRT), ezETH, skilled a big depegging occasion that liquidated tens of millions from “loopers” utilizing the token as collateral on leverage protocols like Gearbox.

In accordance with knowledge from CoinMarketCap, the digital asset’s worth plunged to a low of $2,755 earlier than recovering to its present stage of $3,178 as of press time.

Notably, decentralized alternate Uniswap witnessed a extra extreme depegging of ezETH, with its worth dropping to as little as $700, attributed to liquidity challenges.

Renzo is a outstanding liquid restaking protocol, with over $3 billion value of property locked on its platform, in keeping with DeFillama knowledge.

Liquidation galore

The DeFi protocol Gearbox confirmed that the depeg led to the liquidation of a number of Credit score Accounts.

The protocol’s founder, 0xmikko, offered extra insights into the scenario, saying:

“115 Credit score Accounts had been liquidated, 10,650 ezETH had been bought on Balancer pool. Liquidation losses of 25.77 ETH had been mechanically coated by inner Gearbox reserve fund, no motion wanted.”

Concurrently, Cork Protocol, one other DeFi platform, defined that the liquidations prompted a considerable sell-off of ezETH beforehand held as collateral. This flood of provide overwhelmed the market, driving the value of ezETH all the way down to 0.2.

Curiously, these liquidations occurred alongside the discharge of Renzo’s native REZ token, sparking the emergence of Renzo-related phishing scams on social platform X (previously Twitter).

Web3 safety agency Rip-off Sniffer recognized two situations the place Renzo customers cumulatively misplaced greater than $500,000 to a malicious allow signature rip-off.

Amidst this market turmoil, dealer czsamsunsb.eth capitalized on the scenario, investing 4,099 ETH to accumulate 4,221 ezETH. This transfer proved profitable, because the dealer earned a exceptional revenue of 121.65 ETH, per Lookonchain’s findings.

What does this imply for LRTs?

Crypto analyst Tommy defined that the depegging represents a big threat throughout all LRTs, even with withdrawal choices enabled. He famous {that a} depegging occasion in a decentralized alternate (DEX) pool might happen resulting from momentary imbalances.

Equally, DeFi researcher Ignas warned of potential exacerbation in LRT depegging, primarily if Eigenlayer, the platform the place these tokens function, introduces two key upgrades of slashing and permissionless AVS.

Ignas defined that an AVS malfunction resulting in slashing might scale back restaked ETH balances by a hypothetical 5%. Whereas this may appear manageable for direct Eigenlayer stakers, it might set off substantial disruption to LRT pegs resulting from liquidity considerations and subsequent panic-driven mass withdrawals.

He famous that whereas costs might stabilize post-slash, the interim interval might witness harsh liquidations, and the chance of slashing grows as extra AVSes come on-line.

Consequently, he added:

“It’s all FUD proper now as slashing received’t derail Eigenlayer however LRTs 1) with low liquidity 2) and are broadly accepted as collateral could cause disproportional injury.”

Talked about on this article

Newest Alpha Market Report



Source link

Tags: DeFiDePegezETHliquidationsPlatformsRenzostokenTriggers
Previous Post

North Korean Hackers Lazarus Use LinkedIn to Steal Crypto

Next Post

Are Inscriptions following the path of the Dodo?

Related Posts

Cetus posts $5M bounty for hacker’s ID amid centralization concerns on Sui freeze
Ethereum

Cetus posts $5M bounty for hacker’s ID amid centralization concerns on Sui freeze

May 23, 2025
Ethereum Surges With Force As Price Logs Most Significant Daily Rally In Years
Ethereum

Ethereum Surges With Force As Price Logs Most Significant Daily Rally In Years

May 24, 2025
Crypto Trader Dumps XRP Holdings For Ethereum, Explains Why
Ethereum

Crypto Trader Dumps XRP Holdings For Ethereum, Explains Why

May 22, 2025
Vitalik Buterin praises real-time ZK proving milestone, but urges caution
Ethereum

Vitalik Buterin praises real-time ZK proving milestone, but urges caution

May 22, 2025
$3.8 Billion In Capital Inflows Behind Ethereum’s Post-Pectra Surge, Data Shows
Ethereum

$3.8 Billion In Capital Inflows Behind Ethereum’s Post-Pectra Surge, Data Shows

May 22, 2025
Ethereum Exchange Supply Hits Historic Low Below 4.9% — Is Price Breaking $3,000 Soon?
Ethereum

Ethereum Exchange Supply Hits Historic Low Below 4.9% — Is Price Breaking $3,000 Soon?

May 21, 2025
Next Post
Are Inscriptions following the path of the Dodo?

Are Inscriptions following the path of the Dodo?

The Future of NFTs—Unlocking a New Era of Digital Possibilities | NFT CULTURE | NFT News | Web3 Culture

The Future of NFTs—Unlocking a New Era of Digital Possibilities | NFT CULTURE | NFT News | Web3 Culture

Spot Bitcoin, Ether ETFs Get Official Approval in Hong Kong; ‘Potential Fee War’ Unfolding, Says Analyst

Spot Bitcoin, Ether ETFs Get Official Approval in Hong Kong; 'Potential Fee War' Unfolding, Says Analyst

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Twitter Instagram LinkedIn RSS Telegram
Coins League

Find the latest Bitcoin, Ethereum, blockchain, crypto, Business, Fintech News, interviews, and price analysis at Coins League

CATEGORIES

  • Altcoin
  • Analysis
  • Bitcoin
  • Blockchain
  • Crypto Exchanges
  • Crypto Updates
  • DeFi
  • Ethereum
  • Metaverse
  • NFT
  • Regulations
  • Scam Alert
  • Uncategorized
  • Web3

SITEMAP

  • Disclaimer
  • Privacy Policy
  • DMCA
  • Cookie Privacy Policy
  • Terms and Conditions
  • Contact us

Copyright © 2023 Coins League.
Coins League is not responsible for the content of external sites.

No Result
View All Result
  • Home
  • Bitcoin
  • Crypto Updates
    • Crypto Updates
    • Altcoin
    • Ethereum
    • Crypto Exchanges
  • Blockchain
  • NFT
  • DeFi
  • Metaverse
  • Web3
  • Scam Alert
  • Regulations
  • Analysis

Copyright © 2023 Coins League.
Coins League is not responsible for the content of external sites.

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In