There's a lending protocol where curators are pulling in $300K every single week managing $11 billion in deposits. Sounds like a well-oiled machine, right? Until one vault just lost $24 million on debt backed by collateral that turned out to be 82% fraudulent.

Here's the kicker: the curators? They keep their fees. The lenders? They're left holding the bag. Meanwhile, some borrowers are sitting just 4% away from liquidation, probably sweating bullets.

This is what happens in permissionless markets when fee structures create misaligned incentives. Curators profit regardless of outcome, while the people who actually put capital at risk bear 100% of the downside. The system rewards gatekeepers for participation, not for due diligence.

When collateral verification fails at this scale and the consequences flow in only one direction, you have to wonder: are we building resilient financial infrastructure, or just repackaging old risks with new labels?