For existing borrowers, the freeze itself does not change position health factors or trigger liquidations, LlamaRisk said. Repayments, withdrawals and liquidations continue, and borrowing against other collateral remains available. Users seeking to improve their health factors can repay debt or add other collateral, but cannot deposit more tBTC while the freeze lasts.
The action affects only tBTC on Ethereum Core, not other reserves or the market as a whole. Aave’s tBTC reserves on Base and Arbitrum were already frozen in earlier deprecation rounds, according to LlamaRisk.
Threshold Warns Against New Bitcoin Deposits
In its Oct. 30 notice, Threshold said it paused new $BTC deposits, tBTC minting and new Bitcoin redemption requests through its app as a precaution while “security maintenance” is completed.
Pending redemptions may still be paid on Bitcoin, but final settlement on Ethereum is paused and some transactions may be delayed, Threshold said. Holding, transferring and using tBTC remain unaffected by Threshold’s pause.
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Threshold warned users not to send $BTC to previously generated deposit addresses or attempt new minting or redemption operations through alternative interfaces. Users who have already deposited $BTC should retain their deposit receipts and transaction hashes rather than repeat transactions to clear a pending status, it said.
LlamaRisk said it will monitor tBTC positions and secondary-market liquidity, and propose restorative measures once it has assurance that tBTC operations have returned to normal.