As a result of the change, the Solend platform will utilize less USDC and users will be able to withdraw their funds once again.
The Solana (SOL) whale, which was threatened by a recent Solend governance decision, has contacted the lending protocol and transferred $25 million in USD Coin (USDC) debt to Mango Markets.
Solend said in a tweet that the whale has taken the team’s advice and moved its stance across multiple lending methods. The measure reduces the use of USDC within Solend, allowing consumers to withdraw their assets again.
While the change appears to be a band-aid solution to a larger liquidation problem, the Solend team stated that they are working with the whale and the Mango team to develop a better long-term solution to the fundamental issue.
Aside from that, the lending protocol has also passed another governance vote, lowering the account borrow maximum from USD 120 million to $50 million.
Debts exceeding the new ceiling will be liquidated, regardless of collateral value.
The protocol has also decreased the amount that can be liquidated in a single transaction by lowering its maximum liquidation close factor to 1%. It also reduced the liquidation penalty for Solana from 5% to 2%. Both reductions are temporary and may be changed once the whale crisis is resolved.
On June 19, the Solend lending platform was chastised for its SLND1 governance vote, which intends to seize the whale’s wallet to limit risks. The vote has a 97 percent approval rating. However, many people were outraged since the move violated decentralization principles.
Because of the negative reaction to the initial step, the lending platform decided to hold a second governance vote to nullify SLND1. The second proposal was passed, with 1,480,264 people voting to reject the wallet takeover plan.
