Surf Resumes Cardano Lending With Liquidations Paused

Surf restored core functions of its Cardano lending protocol on September 21. The reopening follows maintenance that began after a security incident in late August, but borrowers and suppliers still face limits on which actions the protocol can process.

Supplies, Borrowing and Some Repayments Return

Surf lets users supply assets to lending pools and borrow against collateral. Its September 21 update lists new supplies, new loans and repayments of healthy loans as available. The reopening restores those basic lending actions for Cardano users, including participants in pools involving ADA.

Withdrawals are possible when a pool has sufficient free liquidity. If the funds are unavailable, the withdrawal remains queued. A user’s ability to withdraw supplied ADA therefore depends on the liquidity of the relevant pool, even though Surf has reopened the withdrawal function.

The team has not published a pool-by-pool breakdown of the restored functions. It said migrations were still in progress when it announced the reopening.

Loans Below a 1.0 Health Factor Need More Collateral

Surf’s current contracts cannot process repayment when a loan’s health factor is below 1.0. That measure reflects how safely a position’s collateral covers its debt. According to the team, the borrower must first add enough collateral to bring the health factor to at least 1.0, then repay.

Adding collateral is separate from repaying with collateral. The latter function remains suspended, as does leverage. Although leverage controls are visible in Surf’s app, the team’s dated operational update still lists the function as unavailable.

Surf has not described a separate process for a position that falls below a 1.0 health factor during this period. Its published instruction for repayment is to raise the health factor with additional collateral first.

Migrated Pools Remain Without Liquidations

Surf entered maintenance after reporting a security incident on August 26. On September 12, it reported that two pool migrations had been completed the previous day. Its September 21 update said further migrations were underway, without specifying how many pools remained or setting a completion date.

Liquidations are still paused. Surf says loans opened before maintenance will be handled separately, but has not published the terms of that process. New loans will follow standard liquidation rules once the function returns. The team has announced neither a date for that return nor a technical explanation for the continuing liquidation pause.

As of its September 21 update, Surf had reopened the main routes for supplying and borrowing on Cardano. The unresolved operational terms concern loans predating maintenance, positions that become unhealthy during the pause, and the remaining pool migrations.