Crypto Lending Platform Maple Finance Unveils Major Overhaul, Stops Lending on Solana

The new version features an overhauled protection mechanism called “first-loss capital” for lenders, which ostensibly absorbs some losses when a loan defaults. Now, only pool delegates provide funds to the default protection and can only be denominated in the same asset as are in the credit pool., Maple’s governance token, in the default protection fund, which was a popular yield-earning strategy for some investors.

Maple Finance’s protocol overhaul includes improvements on withdrawals and its default protection system. “Good design updates,” Walter Teng, vice president of digital assets for research firm Fundstrat, told CoinDesk in a Telegram chat. However, eliminating MPL from the pool cover and halting staking may seriously reduce utility of the protocol’s native token, he added.MPL staking rewards have been halted “due to subdued revenues, volatile market and the need to strengthen Maple fundamentals,” according to a spokesperson’s post on Maple’s Discord server.

The upgrade attempts to patch Maple’s protocol design flaws as it is grappling with its largest debt crisis in its 18-month history. The protocol accrued $54 million of distressed debt in the last two weeks as two of its borrowers,

sndr_krisztian DeFi is pushing the boundaries of crypto but it's important to ensure that token holders are incentivized. We need to design protocols that balance user needs and tokenomics. MPL DeFi

sndr_krisztian Does Maple's overhaul signal a broader issue with decentralized lending protocols?

sndr_krisztian Will Maple's recent loan defaults and debt crisis damage the platform's reputation in the long term?

sndr_krisztian Is Maple's focus on Ethereum over Solana a good strategic decision for the platform?

sndr_krisztian Are Maple's new withdrawal options and default protection mechanism a good move for investors?

sndr_krisztian Is Maple Finance's 2.0 protocol upgrade enough to fix the platform's recent design flaws? Share your thoughts👇

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