OTCs multiply. Over the weekend, the Curve Finance protocol was the target of a major hack.. A flaw was discovered in the Vyper language, enabling a reentrancy attack on the Curve protocol. In all, more than 42 million dollars were stolen. However, this situation highlighted Michael Egorov’s and his massive position on Aave.
Michael Egorov’s situation
Michael Egorov is the founder of the Curve Finance protocol. The latter has a large quantity of CRV tokens at its disposal. Consequently, he decided to use them as collateral on several DeFi platforms in order to take out loans.
It has several positions at its disposal:
- 300M CRV deposited on Aave to borrow $63 million in USDT ;
- 50M CRV deposited on Abracadabra to borrow $14 million from MIM;
- 38M CRV deposited on Fraxlend to borrow $9 million from FRAX ;
- 25M CRV deposited on Inverse Finance to borrow $7 million from DOLA.
In addition, he has several other smaller positions on different DeFi protocols.
Unfortunately, following the hack, the CRV price has become highly volatile. As a result, if the latter were to fall too drastically, Egorov’s various positions could become insolvent.. Insolvency means liquidation.
Nevertheless, as explained yesterday in the Journal du Coinliquidity is running out. So these liquidations, in addition to creating a wave of liquidations on other users, will also generate bad debt for the protocols.
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Michael Egorov tries to save his positions
So, faced with this critical situation, to say the least, Michael Egorov undertook a number of OTC (Over The Counter) exchanges.
For example, he concluded an agreement with Justin Sunfor sale 2.9M dollars in CRV against 2M USDT. A sale at a discount, to be sure, but one that enabled Egorov to recover cash to repay its positions and reduce its risk.
Of course, Justin Sun wasn’t the only one to benefit from these OTC sales. In practice, Egorov sent :
- 17.5M CRV to address 0xf51;
- 5M CRV to Justin Sun;
- 4.25M CRV to DCFGod;
- 2.5M CRV to address Ox4d3 ;
- 2.5M CRV to DWF Labs ;
- 2.5M CRV to Cream wallet: Multisig ;
- 1.25M CRV to address 0xcb5 ;
- 3.75M CRV at machibigbrother.eth ;
- 250k CRV to address 0x9bf.
In total, these are at least 37 million CRV tokens resold by Egorov over the counter.
Of course, these rescues were not without interest. For example, after coming to Egorov’s aid, Justin Sun announced a partnership to deploy Curve on Tron and support stUSDT.
« We’re delighted to help Curve! As steadfast partners, we are committed to providing support whenever needed. Our joint efforts enable the introduction of a stUSDT pool on Curve, amplifying the benefits for users. Together, we aim to strengthen the community and forge decentralized finance! «
At the same time in the cryptosphere, Web3 investigators are investigating whether Sam Bankman Fried is behind the BALD token launched on the Base network..
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