Ethereum faces $547M liquidation risk as 343,075 ETH sits near danger zone in DeFi

More than 343,000 ETH, worth roughly $547 million at current prices, is sitting uncomfortably close to liquidation thresholds across DeFi lending protocols.

On-chain data from Lookonchain flagged the exposure on June 5, showing that the bulk of at-risk positions are clustered between $1,362 and $1,566. With ETH trading near $1,554, some of these positions have almost no breathing room left.

Where the risk is concentrated

The single largest chunk of vulnerable collateral is 137,908 ETH sitting at a liquidation threshold of $1,361.73. That’s roughly 40% of all the at-risk ETH concentrated in one position at the lowest price trigger. If ETH drops about 12% from current levels, that position gets unwound automatically.

But the more immediate concern sits higher up the price ladder. On Maker, 46,741 ETH faces liquidation at $1,565.72. On Aave V3, another 58,032 ETH is exposed at $1,555.04. Those two positions alone account for over 104,000 ETH, roughly $166 million, that could be forcibly sold if the price ticks down just a few dollars from where it currently trades.

When a borrower’s collateral drops below the required ratio, smart contracts automatically sell that collateral on the open market. When multiple positions get liquidated simultaneously, the selling pressure can push prices lower, which triggers more liquidations, which pushes prices lower still.

No cascade liquidation has been confirmed yet.

This isn’t unprecedented, but it’s bigger

DeFi has been here before. A similar liquidation alert surfaced in March 2025, when roughly $320 million in ETH was flagged as at-risk across lending protocols. The current figure of $547 million represents a 71% increase in exposure compared to that earlier episode.

The $1,362 to $1,566 range covers barely 15% of ETH’s price, yet it contains essentially all of the flagged risk. The platforms holding the largest positions, Maker and Aave V3, are two of DeFi’s most battle-tested protocols. Both have survived previous liquidation cascades without protocol-level failures.

What this means for investors

The $1,555 level on Aave V3 and $1,565 on Maker are the numbers to watch in the near term. If ETH holds above those levels, the immediate crisis passes. If it doesn’t, roughly 104,000 ETH in forced selling hits the market before anyone even has to worry about the 137,908 ETH position further down at $1,361.

Investors with active DeFi loans should be reassessing their collateral ratios now. Adding collateral or partially repaying loans to push liquidation thresholds lower is the standard playbook.

Disclosure: This article was edited by Editorial Team. For more information on how we create and review content, see our Editorial Policy.