Data: ‘Risky’ crypto loans surge to highest level in two years
On October 18th, according to IntoTheBlock data, the total amount of high-risk loans (defined as loans with a liquidation price within 5%) rose to $55 million on Wednesday, reaching the highest level since June 2022. Loans within 5% of the liquidation price mean that if the price of the collateral falls by 5%, it will no longer cover the loan, triggering liquidation. IntoTheBlock stated in a market update, "Large-scale liquidation may affect the value of collateral, causing more loans to face liquidation risks and causing a spiral of price declines."
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