There is an ultimate horror script circulating in the crypto circle: BNB suddenly crashes from $600 to $50 overnight. Some believe that only on-chain DeFi is still alive at this point, while others fantasize that a certain stablecoin can carry a 20% premium to become the ultimate safe haven. It sounds exciting, but upon reflection, does this logic hold up under scrutiny?

To be honest, some DeFi protocols have indeed made efforts in risk control. For example, introducing Dutch auction liquidation mechanisms, which theoretically can quickly liquidate collateral during market crashes to avoid bad debt accumulation. It sounds good— but don’t be fooled. If BNB drops more than 90% in a short period, on-chain liquidity will evaporate instantly. Even with a clever auction mechanism, without arbitrageurs (Keepers) participating, it’s all pointless. It’s like having a perfect emergency plan but no one to execute it at critical moments.

A more painful issue is the stablecoin itself. The stability of these coins relies on over-collateralization. When the value of collateral plummets, your "hard peg" starts to wobble. In the future, after migrating to a certain framework codebase, a hard redemption mechanism will be added—allowing redemption of collateral at a face value of $1— providing a final price safeguard. But in extreme panic, this mechanism might instead accelerate collateral depletion, ultimately backfiring and causing more damage.

My approach is simple: never set your leverage at a "just 50% drop and I’m fine" kind of lucky line. Before opening any lending position, I always ask myself: if the asset goes to zero tomorrow, can I still handle it? If the answer is no, then don’t touch that position from the start. This isn’t conservatism; it’s the basic rule of survival.

(Special reminder: The above content is personal analysis for learning and communication purposes only, not investment advice.)