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I'm growing increasing concerned regarding the state of the

money market By taking a long tail approach of supporting numerous low quality tokens with nearly non-existent liquidity as collateral, insolvency risk increases exponentially

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Spencer Noon

@spencernoon

Oct 8, 2020

40% of all $CREAM collateral is a single centralized exchange token. 25% of the entire $FTT float is in $CREAM too. This is straight up reckless from a risk perspective, and the people who are going to get hurt the most are $CREAM holders. twitter.com/meeseeking/sta…

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ChainLinkGod.eth

@ChainLinkGod

Oct 8, 2020

Over 40% of Cream's collateral is $78M of $FTT (25% of float) What happens during a liquidation? Well considering $FTT only has a daily volume of $2M and a whole $6 of liquidity on Uniswap... A downward price death spiral is created and that $78M will never be fully covered

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uniswap isn't where the FTT liquidity is so don't think it's the right think to compare to here

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and

I think that misses the forest for the trees here, no token with $2M in total daily liquidity can handle $78M being liquidated at once without a major downward price collapse (furthering the insolvency) This isn't necessarily a $FTT issue, but an issue for Cream and its users

SBF

@SBF_FTX

Replying to

@ChainLinkGod

yeah hear you on that, just think the uniswap datapoint was wrong also FTT does have a lot more support than it looks like but that's not obvious from anything easy to tell

5:25 AM · Oct 9, 2020Twitter Web App

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and

like not saying your point is crazy here--it's not! just that you're overplaying your hand a little bit, like playing as if your point is 2x stronger than it is

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and

the risk is greater that everything not ftx and srm will be borrowed and sold for stable capital by alameda

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