Crypto lending is suffering from a collateral crisis. We’ve basically consumed all crypto-collateral demand for loans. This is why every lender (from mid-size e.g. FiRM to large e.g. Aave and Maker) is forced to accept higher-risk collaterals to continue to grow e.g. custodial, regulatory, freezing risks to name a few. The $100 billion question is whether this risk-adjusted yield is currently positive, something we’re yet to find out. The fundamental problem still stands anyway: we need new better collateral options OR to find better ways to derisk or hedge against the new risk of the new collaterals and few seem to focus on both