The Solana-based DeFi lending protocol, Solend, has created another governance vote, which invalidated a recent governance vote titled “SLND1: Mitigate Risk from Whale”.
The SLND1 proposal, which was approved, gave Solend Labs the power to access a whale’s wallet (i.e. a wallet that stores a substantial amount of crypto) in the case of an emergency. However, the community declared this power to be illegal and the opposite of what DeFi should be. With 1,480,264 votes against SLND1 in the new governance vote, the proposal is now disregarded.
The goal behind the proposal was to enable the OTC (over-the-counter) liquidations, and to reduce the risk of whales’ liquidation. However, if approved, the proposal would show that anyone’s assets on Solend could be confiscated.
Solend Labs will now have to find another solution to the problem of whale accounts’ potentially highly volatile effects. If not controlled, the whale accounts could trigger a Solana meltdown. This would cause the value of SOL (Solana’s native crypto) to shrink dramatically and would bring Solend down as well.