Hundreds of crypto loans on Curve Finance have crossed into liquidation and stayed there for weeks without being closed out, according to data covering the protocol's lending markets.
That changes what liquidated means. On most lending platforms, crossing a predetermined prices triggers a sale. But Curve gauges how long a borrower stays inside a “danger zone” to calculate how collateral gets converted along the way and whether the position makes it back out.
Data shared with CoinDesk showed 704 cases of soft liquidation across 602 borrower addresses. The median lasted 14.5 days and a quarter ran at least 38.9 days, with some positions sitting inside the liquidation range for months. Of those, 476 began during the first half of 2026.
That is not how liquidation normally works. A borrower puts up ether or another token as collateral, its price falls past a set level, and part of that collateral is sold to repay the loan. On Aave or Compound, what gets sold does not come back if prices bounce afterwards.
Curve's lending system LLAMMA replaces that single point with a range. As the price of collateral falls through it, the system gradually converts the collateral into the asset they borrowed rather than closing the position outright. If prices recover before the loan fails completely, some or all of that conversion reverses.
The strange part is that these borrowers were not simply waiting in a grace period. Their collateral was already being converted while the loan remained open, meaning a position could spend days or weeks partly liquidated and still recover if prices turned around.
Curve Finance is a major DeFi trading and lending protocol best known for stablecoin swaps and its crvUSD lending markets. It holds about $1.35 billion in deposits, according to DefiLlama, while its decentralized exchange processed roughly $3.4 billion of volume over the past 30 days.
Curve generated about $4.3 million in fees and $1.15 million in protocol revenue over that period, with roughly $46 million of active loans outstanding.
Soft liquidation is not free, however. The data shows borrowers can still lose money through trading fees, conversions, rebalancing, interest and repeated price moves in both directions.
A position can still fall into hard liquidation if the market keeps going against it. Even when prices recover, the borrower may not end up where they started.
As such, Curve's data establishes that on this system, crossing into liquidation does not mean a loan is dead, and that hundreds of borrowers spent days or weeks in that state.