Solana-Based DeFi Protocol Everlend Announces Shut Down

Solana-based DeFi borrowing and lending platform Everlend announced that it's shuttering the project and its future development.

In yesterday’s announcement, the project highlighted a lack of liquidity and the overall shrinking of the borrowing and lending market as the causes of its demise. 

“Liquidity is just not there and this is so not just about Solana and the B/L [borrowing and lending] market (on which Everlend is 100% dependent) keeps shrinking,” said Everlend. 

The project said that even with a sufficient runway, continuing to operate and develop the protocol would be a “gamble.”

Everlend has switched its app to withdrawal-only mode and encourages users with deposited funds to remove them from the protocol.

The project also announced that the codebase for the protocol would become open-source, so that “anyone could use what we’ve built and continue the work.”

Solana-based DeFi dries up

The liquidity squeeze mentioned by Everlend comes as the DeFi ecosystem on Solana moves away from Serum, which was the main liquidity provider for nearly all projects in the ecosystem. 

This changed following FTX’s collapse in November when it became known that the project’s private keys were held at the crypto exchange. 

As Serum’s liquidity pools underpinned the vast majority of the Solana DeFi ecosystem and made access to liquidity extremely efficient, it has been an uphill battle to find a suitable replacement.