The instant callability of Aave's model turned from feature to failure during the Kelp fallout. The latest Rheo article traces the property behind it – and the structural fix DeFi never grew: term structure. https://x.com/rheo_xyz/status/2060363804207133059
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Any credit desk does four things. Prices relative value across tenors. Sizes against observable depth. Marks the book between fills. Knows where the exit clears. An intents-based flow gives you a fill. None of the four. A two-sided book gives you all of them, before the trade clears.
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The Nobel-winning Diamond and Dybvig paper proved that any system pairing on-demand deposits with non-callable loans invites a run – even when solvent. That was in 1983. April 18 didn't discover a new failure mode. It just re-ran an experiment. https://x.com/rheo_xyz/status/2050948364825473411
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