Ethereum Price Dip Forces $106 Million Auto-Liquidation on Sky

On April 6, the value of Ethereum fell by around 14%, which led to the forced closure of this investor’s position. The liquidation removed 67,570 ETH, worth roughly $106 million, from the user’s account, according to data from Lookonchain.

During a liquidation, Sky takes control of the user’s Ethereum and sells it to repay the borrowed DAI DAI $1.00 along with fees. If there is any leftover Ethereum after the debt is settled, it is returned to the user.

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Sky, previously known as Maker MKR $1,511.66 before its rebrand in August 2024, allows users to borrow its stablecoin DAI by locking up crypto like ETH as collateral.

The system follows a rule where users must deposit more value than they borrow—usually 150% or higher. This means for every 100 DAI borrowed, a user must provide at least $150 worth of Ethereum.

The platform tracks the value of the collateral constantly. If the price of ETH drops and the collateral value no longer meets the required ratio, the system steps in and liquidates the position. In this case, the investor’s ratio dropped to 144%, which fell below the minimum and triggered the process.

Meanwhile, the team behind the Conor McGregor-backed crypto project REAL has confirmed the sale failed but assured participants they got their money back. What happened? Read the full story.