The team behind Liquity, a lending protocol on the Ethereum network, revealed Wednesday it is currently investigating a "potential issue" regarding its Liquity V2 Stability Pools and urged users to close their positions.
"The Liquity team was informed of a potential issue affecting Liquity V2 Stability Pools, and is currently investigating a potential impact," Liquity wrote on the social media platform X. "The team is currently working on confirming this potential issue and solutions. The protocol continues to work as expected and to the team’s knowledge the potential issue has not impacted any users. Out of an abundance of caution, a Liquity V2 user should close their Stability Pool positions."
Withdrawals of the platform's stablecoin BOLD and staked positions on Liquity's secondary token LQTY haven't been impacted, the team added. Borrowers can also withdraw their collateral assets, the team said.
On Jan. 23 Liquity V2 launched with a new feature enabling users set their preferred interest rates when borrowing against ETH and staked ETH from platforms like RocketPool or Lido, The Block previously reported. Liquity's V2 "Earn" stability pools give users protocol yield from interest and liquidations for depositing BOLD.
The Block reached out to the Liquity team for comment.
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