Michael Egorov, the founder of Curve Finance, faced liquidation of his on-chain loan positions on Thursday, as the price of Curve DAO (CRV) token plummeted by over 25% in just 24 hours. The CRV token, linked to the decentralized exchange, fell to $0.262 at the time of writing, according to The Block's price page. Egorov's loan positions, worth $140 million in CRV, were liquidated across various protocols, including Inverse, UwU Lend, Fraxlend, and Curve's LlamaLend.

The liquidation occurred after Egorov borrowed stablecoins from these DeFi platforms, using CRV tokens as collateral. However, as the CRV token price dropped, Egorov's loan positions became vulnerable to liquidation. Earlier on Thursday, Egorov started facing liquidation on Inverse, but took measures to mitigate further risks. His position on Inverse currently has a health rate of 1.07, just shy of the liquidation threshold of 1. Egorov has begun repaying the borrowed stablecoin DOLA, according to on-chain data.

Further liquidations occurred on UwU Lend, where Egorov's loan positions for USDT and DAI stablecoins were liquidated, worth over $5 million. This brought his health rate on UwU up to 1.08. Arkham Intelligence had previously forecasted the liquidation, warning that Egorov's CRV positions worth $140 million were nearing liquidation. The blockchain intelligence firm predicted that a 10% drop in CRV's value would trigger the liquidation.

In an effort to reduce potential liquidation risks, Egorov sold 106 million CRV for $46 million in August 2023. However, the recent price drop has still resulted in significant liquidations. The incident highlights the risks associated with borrowing and lending in DeFi platforms, particularly when using volatile tokens like CRV as collateral.

As the DeFi landscape continues to evolve, incidents like this serve as a reminder of the importance of risk management and diversification. The liquidation of Egorov's loan positions has sparked a wider conversation about the stability of DeFi platforms and the need for more robust risk assessment tools. As the market continues to fluctuate, all eyes are on the next move of Curve Finance and its founder, Michael Egorov.