In the 16 hours following the Binance attack, stablecoin debt on major DeFi lending protocols fell by $244 million, with the decline driven primarily by debt repayments rather than liquidations.
According to a Santiment analysis dated October 30, total stablecoin debt tracked on decentralized finance (DeFi) platforms fell 4.4% to $5.29 billion. This brought debt to its lowest level since August 7.
While the market downturn and liquidations drew attention after the attack, data from lending protocols showed a different trend: users repaid their debts, reducing their leverage. Liquidations on the protocols examined during the same period were limited to approximately $1.9 million.
A 16-hour drop nearly matched three weeks of debt reduction
Stablecoin debt had fallen by a total of $263 million over the three weeks following its peak on October 5. The $244 million decline in just 16 hours after the attack nearly matched that three-week drop.
Most of the movement occurred between 03.00–07.00 Turkey time on October 30. Debt fell by $213 million during this four-hour period; according to Santiment, that was more than double the largest four-hour decline previously recorded since May.
What does repaying debt indicate?
A liquidation occurs when a protocol forcibly closes a borrower’s position because there is insufficient collateral. In the data examined here, however, the main source of the decline in debt was repayments made by users.
This distinction shows that the reduction in DeFi leverage was driven more by debt repayment than by a wave of forced liquidations. The analysis covers stablecoin debt on major DeFi lending protocols, and the comparison is based on debt and liquidation data from those platforms.
Not investment advice.