Andre Cronje: First large-scale market drawdown on FT triggered only approximately $50,000 in liquidations, lower than traditional LTV models

Odaily Planet Daily reported that Sonic co-founder Andre Cronje stated that during the first major market drawdown experienced by the derivatives platform FT FlyingTulip, the equity-based account lending model generated only approximately $50,000 in liquidations. FT employs net risk calculation instead of a discounted collateral model, with the soft liquidation mechanism taking effect, resulting in an average single liquidation amount of $200 to $2,000. Andre Cronje indicated that if a traditional loan-to-value (LTV)-based lending system had been used, the scale of liquidations under this market volatility could have been 10 to 20 times larger.