- ETH loaner BendDAO has run out of Ethereum.
- This means that users are no longer able to withdraw their funds.
- BAYC is approaching mass liquidation in BendDAO.
The “NFTfi” project known as BendDAO gives holders of NFTs the ability to borrow ETH in the event that they decide to lock up their holdings. However, as of right now, the platform is depleted of ETH and only has 12.5 WETH left in its contract. After it came to light that a Bored Ape Yacht Club (BAYC) whale had taken out more than 10,000 ETH from the protocol
Because BendDAO has run out of ETH, users who have loaned money to other users via BendDAO so that they may purchase NFTs using leverage, will no longer be able to withdraw their funds.
There was a loan of around 15,000 ETH. According to the explanation provided by NFTStatistics on Twitter, this also means that NFT borrowers are responsible for paying interest on the whole amount (100%) of ETH that they have borrowed. The amount of debt secured by these NFTs is significantly increasing at this time.
According to information obtained from the analytics portal NFTPriceFloor, the floor price of BAYC NFTs has significantly decreased, and it is now 64.99ETH. Notably, during the last month, the value of the asset has decreased by about thirty percent, marking the asset’s lowest level since January 2022.
Conversely, in a troubling turn of events for holders of Bored Ape Yacht Club NFTs, assets that were obtained via loans on the peer-to-peer lending site BenDAO may be forced auctioned due to the collection’s plunging floor price.
There are 272 BAYCs connected to loans from BendDAO, with 45 of them now in the “danger zone” of possible liquidation. Moreover, it is significant to note that the 272 BAY associated with BendDAO account for 2.72 percent of the whole collection.