Key Takeaways
CryptoSlate reports Moonwell proposed a recovery plan to reduce bad debt, while trapped depositors face locked USDC funds and unverified reserve transfers.
According to reporting by CryptoSlate, lending protocol Moonwell has introduced a recovery update via governance proposal MIP-X66 aimed at addressing bad debt following an incident on Base. Anthias Labs projects that the proposed rate changes across seven Base markets could reduce monthly interest accruing on outstanding bad debt by approximately 85%, decreasing the figure from about $338,785 to $50,273 if balances and utilization remain unchanged. The proposal also outlines utilizing protocol-owned reserves from Base and OP Mainnet for USDC recapitalization, specifying that user funds will not be transferred. However, the updates do not confirm reserve transfers, provide a timetable for supplier repayments, or guarantee full recovery for depositors. A supplier reported depositing USDC after the incident and subsequently facing unavailable withdrawal liquidity while requesting clearer financial breakdowns. Moonwell stated that reopening borrowing on Base requires separate risk assessments, and security firm Zero Shadow has been retained to assist with ongoing recovery evaluations. CryptoSlate notes that actual execution status and fund returns remain unverified as the governance vote proceeds.
Source & Fact-Check Note
This report is synthesized from coverage by CryptoSlate. Information has been fact-checked and structured for market clarity by CoinQuickly’s research desk.
Read original article at CryptoSlate ↗
