TONIC carried a 20% collateral factor. Per the protocol's own docs, its price module sources that price from VVS Finance and the Crypto.com exchange — the very pool holding $1.26 million of that $1.34 million.
We deployed a supply cap to limit supply to selected markets with regard to the available liquidity of the underlying asset
— Tectonic documentation
On 30 August Cronos halted blocks after a hole was found in Tectonic. That same day TONIC printed its all-time high; it now sits 99.1% below that, and protocol funds shrank to $3.09 million, down 97.4% in a month.
Collateral is worth what you can sell it for right now. Before funding a lending protocol, check what it takes as collateral and where its price comes from.
#security
ByBit: up to $30,000 bonus — my pick for trading!
My channels: Youtube • X • LinkedIn • Instagram • Threads
