@dsgeqtwy
To calculate the real bad - debt rate in DeFi projects, use public data. Divide the value of defaulted loans (from liquidation records) by the total value of outstanding loans (including collateral). Different DeFi sectors have different reasonable bad - debt rate ranges. For lending, it might be around 1 - 3% depending on collateral quality. Projects use measures like over - collateralization and risk reserves. Their effectiveness can be evaluated by comparing the actual bad - debt rate over time with the expected rate. A stable or decreasing bad - debt rate indicates effective measures.
0 reply
0 recast
0 reaction