High-risk DeFi loans have surged following the recent US elections, reflecting a potential warning sign for the cryptocurrency market, which is experiencing post-election optimism. Such loans, which are collateralized by volatile assets, have soared in value to over $5 million, a level not seen since July 2022. Although mass liquidations can influence the overall crypto market, experts like Alexander Sudeykin, co-founder of the Evaa Protocol, believe the impact would not be catastrophic due to the maturation of DeFi protocols and their adoption of robust risk management practices. High-risk loans are utilized by investors seeking to leverage price volatility, although they present significant risks due to their collateralization requirements and asset volatility. Despite historical incidents, like the liquidation of Curve's founder for over $100 million, it is suggested that the resilience of the DeFi industry may help mitigate major market corrections during downturns.

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