) as collateral. Borrowers must maintain a certain collateral level to avoid liquidation. To counter volatile crypto prices, Maker requires loans to be over-collateralized, meaning borrowers have to lock up a higher value of assets than their debt.
But Peter Johnson, the lead plaintiff, claimed that Maker advertised the over-collateralization policy as a safeguard that caps losses at 13% and that the collateral would return to users. When ETH’s price sharply dropped in March 2020 during a market-wide crash, his position and that of many others on the platform were liquidated, Johnson alleged.The suit alleged that investors suffered a total of $8.3 million in losses, and sought compensation and punitive damages of $20 million.
Plaintiffs may amend the complaint and file a third version until March 17, “as there is no showing the deficiencies noted above cannot be cured,” the judge said.
Loans Loans Latest News, Loans Loans Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Source: CoinDesk - 🏆 291. / 63 Read more »