I feel sad for all those who lost their money. For some, it was their life savings and it could feel devastating. I also had my liquidation price set to $906 before sleeping.
There were two conflicting forces in my head:
Bear Case [why i should not do (9, 9) and repay my loan]:
How OlympusDAO felt by ~40% in matter of minutes.
Sifu mentioning that his liquidation price is fluid [and thus it might be case that he has lowered his liquidation price even though he last said it to be around $1100].
Buybacks are manual and single big liquidation can be cascading.
Bull Case:
Sifuās level of confidence [as shown in image by OP] [and also him mentioning that he is crypto OG, has price alerts setup, dani and him takes shift, also endorsing otherās liquidation price.
I was buying AVAX for more USDT at KuCoin than what I was getting MIM for when selling AVAX on TraderJoe (more liquidity for this pair than in Sushi).
So ultimately, I decided to keep funds ready in my account for just in case scenario but also decided not to repay before going to bed. Also, my python script to wake me up if price fell below ~$1400 wasnāt working as expected so did few modifications, hoping that it will work (now I think that I really took a big undue risk).
Luckily my alarm rang and I was able to pay up majority of my loan. Seeing the volatility, I decided to sell my other crypto assets to pay for remaining amount too and it is at this point that I noticed congestion in AVAX network. I also sold all of my ADA and some amount of ERG coins to buy wMEMO when TIME price was ~$850 as I firmly believe in project because I have thorough understanding of it.
Having said all this, I donāt think Sifu is accountable but atleast he should refrain from strong positive affirmations.
I hope good for Wonderland and the team and most importantly, I really do hope that those who lost their money, make a lot more than their lost amount in future.
Again, Iām not argument that there isnāt risk, Iām saying that the treasury manager lied about what he was capable of. And what the treasury was capable of, even when addressed about this very topic. Any reasonable person would have deleveraged more, or even sold (even for a loss) over getting Liquidated all based on the Treasury Managers word.
Sifu got liquidated in the $1100 range (per Memo) for $30 million which caused a further liquidation cascade under $800. In all honesty, not a responsible move from the head of the treasury.
He created the cascade; by convincing people that the treasury was taking care of the liquidation problem in the first place. I (and many others) would have deleveraged sooner or outright sold for a loss, over being Liquidated. Obviously.
I donāt know if it was intentional but it surely was negligence and definitely a lie, regarding the treasuryās capabilities.
If the management said they would buy if it ever fell below backing price , did they specify that buying would take place so it didnāt drop below or once it did drop below they would buy. Itās a big difference , they could take a week to buy if they wanted if it wasnāt specified . so depending on the answer to that is what would be fair . The ones who behaved in a safe manner and didnāt leverage should not be held to suffer their investment for people who behave irresponsible and gamble with leverage no matter how small the gamble itās a gamble.
1.) The manager of the Treasury lied/misled about the treasuryās capabilities in regards to protecting the investors money. And even, Specifically about what happened (very specifically).
2.) Your share of the marketcap would not be affected. The treasury should have been implemented to protect itās investors, as advertised.
SIDE NOTE: You would have plenty more would-be people investing (all the Liquidated + all the people who will exit AS SOON as they break even) over the protection which didnāt get implemented. It would help, not hurt your bags.
3.) Again, he lied about the capabilities of the treasury. No reasonable person on earth would assume that ābacking priceā actually means āsomething way below backing price,ā when referring to it. I understand some nuance. But if youāre advertising or referring to ābacking priceā thatās specifically a price in which you set, to back the price, regardless of how you want to defend or redefine it.
4.) If Sifu had said nothing at all, investors would have deleveraged, or even sold for a loss, over getting liquidated. Obviously. And there would be no debate at all.
The fact that he was bragging/lying/misleading people about the treasury capabilities, is the entire argument here. And itās also what caused the cascade. Otherwise it may have been a regular sell-off.
This is what was sold to the investors.
This is why this argument is happening in the first place.
Itās not just because āpeople got Liquidated and theyāre upsetā
They were lied to specifically about the very subject.
We wouldnāt be having this discussion at all if there was no ābacking priceā reference at all. It would have been a Liquidation event, and thatās it. But since we were sold a bill of goods (that included a backing price) thatās what makes this argument worth having.
Just so weāre clear, Iām not arguing for/against the backing price discussion. My argument is based on what Sifu was explaining about what the treasury is capable of, and what it does.
But, if we are talking about a ābacking priceā then thereās an argument there as well. It could be argued that Sifu said, he was going to keep it above said ābacking price.ā
He misled his investors into a Liquidation cascade in which he caused, by saying the treasury would handle the price action and Liquidation cascade specifically.
The argument is that we were told/sold specifically that this wouldnāt happen because ātreasury is so strong/big, we can handle this very situationā
Otherwise, any reasonable person would have just deleveraged or sold for loss, as opposed to Liquidation.
I argue, that this caused the Liquidation cascade, specifically because the investors were lead down a path (āprotected by treasuryā) just to get slaughtered.
The treasury should have acted as protection (which is how it was sold) and possibly been damaged (at least a little) in order to protect the investors.
Itās not a stupid position when the crytpo that you invested in specifically talk about protecting against these events. āThe treasuryā is so big in order to protect its investors. It was not used in this regard. And was advertised otherwise.
I understand what your saying. I was thinking it wouldnāt drop below. I decided to play it safe and allow that to happen at least once to ensure my thought was correct.
Saying they lied and made you believe that though is a stretch.
Would you agree technically they never said it when the buy back would happen?
Wow. You missed the entire argument. You will not make it, worrying about whether people around you are going to be āgreedyā or not (They are, and always will be, fyi)
The argument is not about leverage or greed, but good luck, frog Stronk, right!?