A Waves proposal aimed at solving Vires.Finance’s liquidity problem has been adopted after gaining support from its community.

The Waves (WAVES) community has backed a governance proposal to revive the Vires.Finance lending protocol for decentralized finance (DeFi) following its liquidity crisis. The vote is intended to stabilize the project and compensate the affected users.

In April, Neutrino (USDN), a stablecoin running on the Waves platform, broke away from the dollar. This led to a series of user withdrawals within the platform, which eventually led to a liquidity crunch where users were no longer able to withdraw their funds from the platform. During the event, Waves founder Sasha Ivanov stepped in and accumulated $500 million in debt in his wallet with the intention of gradually paying it off.

To fix the situation, the Vires team has submitted a proposal that offers two options to users with a balance of over $250,000 on the platform. The first option is to convert your positions into USDN, with a one-year lock-up period and a 5% liquidation bonus. The second option is to stay in USD Coin (USDC) and Tether (USDT) with 0% APY repaid by Ivanov with no guarantees on the timeframe for payments.

With the proposal going into effect, the Vires team expects better liquidity that will allow users to withdraw their funds from the platform. In the announcement sent to Cointelegraph, Ivanov thanked the Waves community for supporting the proposal and stressed that the community always has the final say on their platform.

Related: These are the least “stable” stablecoins not named TerraUSD

Following the fall of Terra’s stablecoin Terra Classic USD (USTC), some stablecoins showed signs of breaking away from their dollar pegs, bringing fear to the crypto market. One of them is DEI, the stablecoin from Deus Finance. In May, the DEI fell from its dollar peg to $0.60. At the time of writing, the stablecoin is trading at $0.17.

Aside from DEI, the price of stablecoin protocol USDD also showed signs of weakness in June, dropping to $0.97. However, the Tron DAO Reserved mobilized 700 million USDC to defend their bond. At the moment, the stablecoin is trading between $0.99 and $1.

Source: CoinTelegraph