Historical bad-debt events
Frax Finance's assessment for RD-F-067 — scored green on the v1.7.0 rubric. The evidence below is the curator's reasoning for this score.
Evidence summary #
June 2024 Egorov/CRV liquidation cascade: Frax Finance stated 'zero bad debt on Fraxlend due to our partial liquidation, DDR, isolated lending design.' CRV fell 24%+ triggering liquidations across 5 venues (Inverse, UwU Lend, FraxLend, Aave, LlamaLend). Fraxlend isolated-pair design and Dynamic Debt Rebalancing (DDR) prevented socialized loss. LlamaLend (Curve) incurred $10M bad debt; Fraxlend did not. No other documented bad debt events in Fraxlend history. Green: no confirmed bad debt events with socialized lender loss.
Sources #
- URLPosition Health & Liquidations | Frax FinanceFraxlend docs: bad debt mechanism — isolated pair DDR prevents socialization; liquidator absorbs what collateral covers, remainder distributed to lenders only in that pairretrieved 2026-05-17
- Curve Finance Founder Suffers Massive Liquidations — The DefiantThe Defiant: Curve Finance Founder Michael Egorov Suffers Massive Liquidations; Fraxlend zero bad debt claimretrieved 2026-05-17
Methodology #
Count and sum (USD) the number of documented bad-debt events where the protocol socialized losses across depositors.
See the full factor methodology and distribution across all protocols →