This isn't being talked about nearly enough - I think it's because a lot of people dont know how utilisation rates in DeFi work. They deposited WLFI as collateral (this is really bad collateral) and then borrowed $75M USDC - this pushed utilisation rates up to 100% What this means is, if you were a supplier of USDC to this pool, you now cannot withdraw any of your USDC. If the utilisation is 100% - you cannot withdraw your USDC. What's supposed to happen is this - supply rates for USDC will now be really high, so suppliers will be earning really good interest rates. As such, more people usually deposit into the supply side to take advantage of the high interest. However, as no one trusts WLFI protocol, no one is adding USDC. If no one adds any more USDC, and the USDC borrowers don't repay their USDC debt? You'll never get your USDC back. Not only that, but if WLFI token value falls below value of borrowed USDC - the WLFI will need to be liquidated to pay the USDC debt. But....WLFI is illiquid and has very little demand.... If you can't liquidate that collateral effectively, you will end up with bad debt. If there's bad debt, the Trump cartel keep the USDC and regular retail suppliers don't get their USDC back. So effectively, the Trump cartel stole that USDC. Maxxing out your own projects utilisation on USDC is CRAZY reckless. TL:DR Soft rug in process? Inevitable bad debt? Not good.