nLEND Redemption Platform Launch Update

Dear Demex Community,

We are preparing to launch the nLEND redemption platform tomorrow, June 26, 2025, provided there are no last-minute technical issues.

This step reflects our ongoing efforts to address the challenges following the Nitron incident and to act in the best interests of all stakeholders—our lenders, stakers, traders, as well as the wider Demex community.

⭐ Redemption Adjustment

To ensure fairness for all parties, we have adjusted the redemption process.

Rather than using token values from the incident date (as noted in our Nitron Post-Mortem), we will convert nLEND based on token prices on CoinGecko at June 25 2025, 12PM UTC+8, which represents the closest viable timing before our on-chain upgrade. The updated mark price table is as follows:

This decision was made very carefully in order to support an equitable outcome for all groups.

The primary reason for this change is the dramatic decline in the value of certain tokens, such as milkTIA and TIA, by over 40%. Using the original token prices would make recovery of nLEND to $1 nearly impossible, especially since they constitute a large percentage of lost tokens.

We would also like to note that the expected initial recovery amount has already been affected due to the pace at which we could recover and liquidate tokens from 3rd parties. That initial value now stands at $69,767.07.

If the previous prices were to be used now, the reduced value of these small cap tokens would actually be subsidized by lenders of USD and other major tokens such as ETH & BTC, effectively siphoning their recovery amount.

With these changes, every group will be fairly compensated and will result in a more favourable initial nLEND redemption price of $0.09794.

Note that the Affected Ratio from our previous post remains unchanged.

⚙️ Platform Mechanism

Affected assets will be automatically converted to nLEND, and users will be able to find their nLEND in their Nitron collateral after the on-chain upgrade tomorrow.

In order to redeem nLEND for USD, users must first return borrowed assets such that their Nitron position will remain healthy after withdrawing nLEND (LTV=1.00, Price=$0.09794). Following which, they can withdraw nLEND from Nitron and proceed to the redemption platform.

The nLEND redemption platform is designed to be straightforward and transparent, allowing users to make informed choices. Here’s how it will function:

• Spot Market: Beginning tomorrow, June 26, 2025, a nLEND/USD spot market will be available. A floor of $0.09794 for the entire nLEND supply will be placed. Users can buy or sell nLEND at any price above the current redemption price via the spot market interface.
• Simple Redemption Platform: A separate nLEND redemption UI will allow Nitron users to easily convert nLEND to USD without using the trading interface.
  The redemption price will no longer be a fixed price, but serve as a floor price as better-priced spot limit orders will be used. The interface will show the estimated (and minimum) output, providing clarity for your decisions.

💙 Nitron Status

After the on-chain upgrade is successful, Nitron will be configured as such:

• Further lending or borrowing or will remain unavailable for now
• Users will be able to return borrowed assets and withdraw lent or collaterized tokens (either unaffected tokens or nLEND)
• Interest accrued since May 16 for all assets (including USC) will be zeroed out during the on-chain upgrade (regardless of what the current interface indicates)
  • Interest will start accruing again immediately after the upgrade
• Liquidations will be paused on Nitron
  • Users will have 7 days to make their positions healthy
  • On July 3rd, positions that remain unhealthy will be liquidated by the team, and any additional bad debt affected by legitimate users will be paid off by the team

🌱 Our Ongoing Efforts for Recovery

We are guided by integrity and a commitment to our community and remain fully dedicated in our pursuit to restore value for all users.

In addition to direct recovery efforts, we are pursuing multiple other paths, including discussions with relevant parties to explore strategic options. Our aim is to deliver the best possible resolution, and we remain hopeful that full restitution for lenders will be possible.

🤝 Next Steps

As we approach tomorrow’s launch, we invite you to review the updated mark price table and engage our support team who will assist with any questions. Thank you for your patience and understanding as we navigate this challenging journey together.

Sincerely,
The Demex Team