The post ‘We have limited risk:’ Jupiter Lend addresses Solana DeFi contagion fears appeared on BitcoinEthereumNews.com. Jupiter Lend, a leading lending platform on Solana, has faced backlash amid allegations of ‘false advertising’ about risk. According to critics, the platform ‘lied’ about its isolated risk and its rehypothecation could spark a wider DeFi contagion.  Responding to the allegations, Jupiter Lend’s Kash Dhanda acknowledged that the initial ‘zero contagion’ claim from his team was not ‘100% correct’ and added, “There is a very limited risk of contagion…But the vaults are actually isolated, even at each asset level. It is true, there is rehypothecation…this is where the yield on collateral comes from.”  For the unfamiliar, rehypothecation involves a lender reusing a borrower’s collateral, like securities for banks or tokens in the crypto space. This directly increases leverage that can be risky during liquidation events or bank runs (widespread instant redemptions).  Notably, the above risk triggered the depegging of Stream Finance’s yield-bearing stablecoin xUSD and related assets in November. Investors incurred hefty losses. As such, Jupiter Lend critics feared the protocol could expose broader Solana DeFi to a similar explosion.  Kamino slams Jupiter Lend The scrutiny began after Samyak Jain, founder of Fluid, acknowledged that Jupiter Lend vaults re-use users’ collateral for yield hunting and are ‘not completely isolated.’  Marius, founder of another Solana lending DeFi Kamino, noted that Jain’s statement contradicted his (Jupiter Lend) rival’s earlier claims of ‘no contagion’ risk.  For him, this meant “misleading users” and denting trust. As a result, Marius said Kamino blocked a migration tool to Jupiter Lend to mitigate the risk.     “There is no isolation here and full cross-contamination, contrary to what is advertised and what people are being told.” Source: X For Tushar Jain, Managing Partner at Multicoin Capital, the team at Jupiter was either ‘incompetent’ or ‘misleading users to attract deposits.’  Market reactions Despite the crisis, there were no massive outflows… The post ‘We have limited risk:’ Jupiter Lend addresses Solana DeFi contagion fears appeared on BitcoinEthereumNews.com. Jupiter Lend, a leading lending platform on Solana, has faced backlash amid allegations of ‘false advertising’ about risk. According to critics, the platform ‘lied’ about its isolated risk and its rehypothecation could spark a wider DeFi contagion.  Responding to the allegations, Jupiter Lend’s Kash Dhanda acknowledged that the initial ‘zero contagion’ claim from his team was not ‘100% correct’ and added, “There is a very limited risk of contagion…But the vaults are actually isolated, even at each asset level. It is true, there is rehypothecation…this is where the yield on collateral comes from.”  For the unfamiliar, rehypothecation involves a lender reusing a borrower’s collateral, like securities for banks or tokens in the crypto space. This directly increases leverage that can be risky during liquidation events or bank runs (widespread instant redemptions).  Notably, the above risk triggered the depegging of Stream Finance’s yield-bearing stablecoin xUSD and related assets in November. Investors incurred hefty losses. As such, Jupiter Lend critics feared the protocol could expose broader Solana DeFi to a similar explosion.  Kamino slams Jupiter Lend The scrutiny began after Samyak Jain, founder of Fluid, acknowledged that Jupiter Lend vaults re-use users’ collateral for yield hunting and are ‘not completely isolated.’  Marius, founder of another Solana lending DeFi Kamino, noted that Jain’s statement contradicted his (Jupiter Lend) rival’s earlier claims of ‘no contagion’ risk.  For him, this meant “misleading users” and denting trust. As a result, Marius said Kamino blocked a migration tool to Jupiter Lend to mitigate the risk.     “There is no isolation here and full cross-contamination, contrary to what is advertised and what people are being told.” Source: X For Tushar Jain, Managing Partner at Multicoin Capital, the team at Jupiter was either ‘incompetent’ or ‘misleading users to attract deposits.’  Market reactions Despite the crisis, there were no massive outflows…

                                                                               Bitcoin gained fresh downward BTC price predictions on the back of an options expiry event and thickening bid liquidity on exchange order books.                     Key points:Bitcoin fails to close above $117,200, opening the door to support retests.A giant $4.9 trillion options expiry event adds further friction for Bitcoin bulls on Friday.Read more