Vitalik Buterin Sounds Alarm: ETH Treasuries Risk Leverage-Induced Collapse

Ethereum's co-founder drops a bombshell—crypto's golden goose might be cooking itself.

Leverage: The double-edged sword

Buterin's warning cuts through the DeFi hype: Those fat ETH treasuries everyone loves? They're primed for a cascading failure when overcollateralization meets market chaos. The same mechanism that supercharges yields could trigger a death spiral.

Protocols are playing with fire

Every major DAO's balance sheet is packed with ETH—locked, staked, and rehypothecated to oblivion. When (not if) volatility strikes, the domino effect will make Terra's collapse look like a picnic. But hey, at least the VCs got their exit liquidity.

The irony? Ethereum's success created this monster. Now its architect is telling builders to put down the leverage crack pipe before someone gets hurt. Will they listen—or keep chasing those sweet, sweet APYs straight off a cliff?