1. What happened
- On October 10, 2025, Venus experienced an oracle deviation of $CAKE and some other assets. As a result, it incurred around $1.2M worth of bad debt:
- BNB Chain – 393,891.780156957 CAKE + 4,191.784165515 FIL
- Ethereum – 231,995.011723284 EIGEN
- Total: ~$1.17 m (balances as of 31 Oct 2025).
- To get more details about the incident, please check Chaos Labs’ analysis: Chaos Labs - Market Volatility Risk Update - 10/14/2025
- As the debt continues to accrue interest, we propose to repay it as soon as possible, taking advantage of the current market conditions.
2. Proposed remedy
Use the protocol Risk Fund (Core Pools) to fully clear the shortfall.
Step1. VIP to transfer up to 1.2 m USDT from Risk Fund to DEV_ADDR
Step2. The USDT will be swapped for the exact CAKE, FIL and EIGEN amounts (through Binance CEX)
Step3. The swapped tokens will be transferred to a Safe wallet which will then call repayBorrowBehalf() for each market and transfer the remaining fund back to risk fund if there is any, this should remove the bad debt and stops interest growth
3. Impact on stakeholders
- Suppliers regain 100 % liquidity.
- Protocol health metrics (total collateral vs. borrows, utilisation) return to normal.