Surge in High-Risk Crypto Loans Sparks Concerns of Liquidation Cascades and Market Volatility
According to IntoTheBlock, the amount of crypto-collateralized loans that are within 5% of their liquidation price has reached its highest level in over two years. This surge in high-risk loans could lead to potential liquidation cascades and market volatility. The decentralized lending market is experiencing a boom, with high-risk loans reaching their highest level since June 2022, sparking concerns about volatility and liquidation cascades. Analytics firm IntoTheBlock reports that the total amount of high-risk loans rose to $55 million on Wednesday.
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