Curve founder Michael Egorov has proposed a market-based mechanism to recover DeFi bad debt by turning distressed positions into an investable product. The idea arrives as the Kelp DAO fallout intensifies debate over recovery math, bailout optics and who should absorb losses when failures spread across protocols. DeFi’s latest crisis has reopened an old argument [...]
The post DeepBook suffers $239.7K bad debt – What it means for leveraged DeFi appeared on BitcoinEthereumNews.com.
DeepBook’s leveraged trading infrastructure faced mounting pressure after its USDC margin pool became undercollateralized on the 9th of May. On a post on X, the protocol announced that around 3:18 AM UTC, the imbalance generated nearly $239,700 in bad debt. Source: X The disruption unfolded as collateral values deteriorated faster than DeepBook’s liquidation engines could react during volatile conditions. Withdrawal thresholds near 2.0x and liquidation targets around 1.25x briefly failed to absorb the shock. That weakness exposed how rapidly leverage can destabilize shared liquidity pools once volatility accelerates. However, protocol solvency remained intact as the insurance fund fully restored affected balances without user losses. That response prevented broader contagion across DeepBook’s roughly $16 million ecosystem liquidity, while reinforcing how liquidation latenc
The post After the $16.5 billion in exploits, DeFi is now being forced toward the controls it once resisted appeared on BitcoinEthereumNews.com.
Make CryptoSlate preferred on The rsETH crisis resulted in $200 million in bad debt on Aave’s books, despite not a single line of its contracts misbehaving. On Apr. 18, attackers that Chainalysis preliminarily linked to Lazarus compromised RPC infrastructure, forced a failover to poisoned nodes via DDoS, and injected false data into a 1-of-1 DVN configuration on KelpDAO’s rsETH bridge. The forged message released approximately 116,500 rsETH, and Aave’s incident report confirmed that Ethereum accepted nonce 308 while the Unichain source endpoint never advanced past 307. The attacker supplied the compromised rsETH to Aave and borrowed against it, resulting in bad debt and serving as a frame for the current state of DeFi’s security. Exploiters extracted over $635 million across 28 incidents in April, the worst monthly total in over a year. DefiLl
The post Why Tokenized Gold Trading Crossed $90B in Q1 2026 (And What It Means for DeFi) appeared on BitcoinEthereumNews.com.
Tokenized gold trading volume reached $90.7 billion in Q1 2026 alone, exceeding the $84.6 billion recorded across all of 2025. The figure comes from CoinGecko’s Q1 2026 RWA Report, which documented tokenized commodities (overwhelmingly gold-backed) growing 289% from $1.43 billion to $5.55 billion in market capitalization over fifteen months. The numbers point to a category that crossed an inflection point sometime in late 2025. Tokenized gold is no longer a side experiment in DeFi; it’s a measurable segment of on-chain activity with volume comparable to mid-cap altcoins. This article looks at what drove the surge, how the category breaks down structurally, and what the volume signals for DeFi yield in the rest of 2026. What the $90B Number Represents The $90.7 billion figure covers Q1 2026 spot trading across PAXG, XAUT, KAU, KAG, Comtech Gold, and other token
The post How Hyperliquid Managed to Lead 3 DeFi Apps That Paid Holders $96 Million In 4 Weeks appeared on BitcoinEthereumNews.com.
Three young DeFi applications, Hyperliquid, Pump.fun and edgeX, returned $96.3 million to token holders in 30 days. The figure marks one of the largest concentrated payouts from any DeFi cohort tracked in 2026. Each protocol used a different mechanism to deliver the cash. Only Hyperliquid funded its full payout from trading fees alone. Pump.fun split revenue with operations, and edgeX paid out roughly three times what it earned. The DeFi Shift From Emissions to Real Revenue During the past cycle, DeFi protocols rewarded users by minting tokens and distributing them through liquidity programs. The model inflated supply faster than demand, leaving holders to absorb relentless dilution. Hyperliquid (HYPE), Pump.fun (PUMP) and edgeX (EDGE) sit at the front of a different cohort. They generate fees from active products and route part of those fees back to holder
Digital credit's high Sharpe ratio positions it as a superior investment over traditional financial instruments.
The post Michael Saylor: Bitcoin as digital capital offers significant yield potential, how digital credit reduces volatility, and the transformative role of DeFi in crypto | The Wolf Of All Streets appeared first on Crypto Briefing.
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