2026-01-05 01:26:19

Last week, I was helping a friend download a lending app. I was scrolling through screens on the side, occasionally checking the market—cryptocurrency prices were very stable, nothing unusual. Suddenly, a message popped up: "Bro, I got liquidated?" I was stunned, quickly pulled up the K-line chart to check. Upon zooming in, I noticed the clue—a sudden cliff-like candle lasting only a few seconds appeared on a low-liquidity trading pair. Just this abnormal fluctuation caused the app's price feed to treat it as real market data, instantly triggering the liquidation mechanism. My friend's loan went from stable to high risk, and he was liquidated in an instant.

This reveals a core risk in crypto lending: liquidation doesn't necessarily require the entire market to crash; as long as the price source is manipulated, it’s enough. The trick used by bad actors is actually quite simple—find a trading pool with low liquidity, drain funds, then place large sell orders to create a false low price in a short period. Once the oracle captures this manipulated price, the lending protocol perceives the collateral as devalued, triggering a series of liquidations. When the price normalizes, the malicious actor has already bought a large amount of cheap assets at the low point and can walk away unscathed. Victims are left wondering: the market didn't move, so why was I liquidated?

The root of the problem lies in the price feed source. Relying on data from a single exchange is too easy to manipulate; a more robust data aggregation solution is needed. For example, pulling data from multiple trading channels simultaneously, using median and time-weighted average methods to filter out anomalies. This way, even extremely low prices can't sway the overall market trend; short candles lasting a few seconds become insignificant after smoothing. Coupled with periodic refresh mechanisms, outdated data can be rejected in time, and large price jumps can trigger automatic pauses in price assessment.

From an application perspective, besides optimizing the price feed, additional protective measures can be implemented: applying liquidation delays for extreme prices, increasing risk buffers for assets with low liquidity. Only then can the loophole in the lending market be truly sealed.

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rugpull_ptsd

· 01-07 21:22

Damn, this is the reason I got trapped last time. Oracles are really outrageous. A fake dip of just a few seconds can clear me out? Unheard of. Relying on a single data source is the original sin. It should have been multi-source aggregation long ago, and they're still using this approach. My friend was directly liquidated, and I'm angry for him. These market makers' tricks are too deep. Price source optimization? Easy to say, but there are very few protocols that have actually been implemented.

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UncleWhale

· 01-07 13:54

This oracle is really outrageous, it can be life-threatening in just a few seconds. It's the price source's fault again. When will there be a reliable solution? My friend was unfairly亏得 this time; the market didn't even move. If lending platforms keep playing like this, they'll eventually collapse. The liquidity pool is too shallow, easy to be smashed. Data aggregation from multiple exchanges should have been implemented long ago. That's why I never play with high leverage; it's too dangerous. The liquidation mechanism is a bit too sensitive. Manipulating the oracle is really rampant. A single data source deserves to be wick-killed.

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MoonWaterDroplets

· 01-07 08:48

That's why I never borrow money from liquidity pools with poor liquidity—it's too easy to get liquidated. A few seconds of a candle can liquidate you? Oracles definitely need to be improved. Price source aggregation really should become standard; relying on a single data source is a ticking time bomb. Friends lost a lot? This tactic is basically a low-level version of a flash loan attack. Multi-chain aggregated pricing is the way to go; otherwise, you'll eventually fall into a trap.

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SudoRm-RfWallet/

· 01-06 21:49

That's why I never rely on a single exchange's price source; multi-source aggregation is more reliable. Once the oracle is compromised, your collateral can turn into worthless paper in minutes. This trick is too dirty; a flash of a few seconds can harvest a batch of people. It was about time to add a liquidation delay protection mechanism. Are you still running naked? My friend was truly wronged this time; the market didn't move, but he was still liquidated. Trading pairs with poor liquidity are inherently high-risk zones; you should be aware of the risks when participating. Basically, it's still a problem with protocol design; you can't rely on a single data source.

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MelonField

· 01-05 01:56

Wow, a few seconds of candles can cause a liquidation? This oracle is really making a killing. The liquidation mechanism really needs to be improved, or else everyone will get exploited. Thinking back to several projects that were drained by flash loans, the tricks are really the same. Is it so easy to fool a single data source? It should have been multi-source aggregated long ago. My friend is really unlucky; the market is as steady as a rock but still got caught. That's why I never go all-in with leverage; there are too many pitfalls waiting. It would be great if oracles could verify across multiple chains, but cost is an issue. I feel like lending protocols should learn from these lessons; to avoid being exploited, they need protection. With such shallow liquidity pools, dare to use them as price sources? Ridiculous. The delayed liquidation trick is pretty good; at least it can slow down the speed of getting liquidated.

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Hash_Bandit

· 01-05 01:56

ngl, this flash crash oracle manipulation stuff hits different when it's your mate getting liquidated over a few-second wick. reminds me of the early mining days—one bad difficulty epoch could tank your whole operation. price aggregation really is the backbone here, like proper hashrate distribution across pools. single exchange data? that's asking to get owned.

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StakeTillRetire

· 01-05 01:54

This is a typical variant of flash loan attacks. The oracle component must be given serious attention. *** Manipulating thin pools to deceive the oracle—I've seen this trick too many times... The scary part is that most protocols can't defend against it. *** So when can we properly solve the issue of price sources? After hearing "improvements" for so many years. *** Your friend probably went into shock the moment they got liquidated. The market didn't react, but they got wiped out. *** Multi-source aggregation + delayed liquidation must be combined; relying on just one can't solve the fundamental problem.

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SybilSlayer

· 01-05 01:51

That's why I don't touch lending with low liquidity tokens; it's too easy to get liquidated. Oracles are indeed the biggest vulnerability; a single exchange's data being compromised can ruin everything. Multi-chain aggregation should have been standard long ago; it's ridiculous that some platforms still rely on single sources... Your friend was lucky this time; at least they noticed in time, while some people don't even know how they got liquidated. If the price source protection isn't well implemented, no matter how much collateral you have, it's all useless.

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