# How soft-liquidation works in curve lending

- Channel: [EthCC](https://streameth.org/ethcc)
- Date: 2024-07-18
- Duration: 25:41
- Topics: DeFi, lending, stablecoin, blockchain, cryptocurrency
- Watch: https://streameth.org/watch/669975af237940f4df99feb2

## Description

I explain how soft-liquidation works in curve lending with real life positions, the technical implementation of soft-liquidation and what's needed to open a permissionless lending market on curve. I cover benefits and risk for users and projects. The video features Martin from Curve discussing soft liquidation within the context of Curve Lending and Curve USD. Martin, a DeFi veteran and full-time contributor at Curve since September, aims to explain soft liquidation in an accessible way for all viewers. He touches on his background and role as a facilitator integrating external developments into Curve.

Martin initially defines Curve as an Automated Market Maker (AMM) that has evolved to include its own stablecoin, Curve USD, and a lending market. He highlights the significant cash flow generated from fees on both the AMM and the minting of Curve USD, with a recent week bringing in $70k for token holders.

He explains that Curve is not just an AMM anymore; it earns most of its revenue from its stablecoin, making it crucial to promote Curve USD. Martin also discusses the concept of soft liquidation as part of the stablecoin ecosystem, designed to address liquidity issues faced by the founder of Curve.

The video further delves into how soft liquidation functions within the minting process of Curve USD and its lending market. Martin presents various data views, showing high borrow rates and explaining how collateral is managed with ETH and Curve USD. He describes soft liquidation as needing a price feed, liquidity, and collateral within certain