# Governance Request: Fair Withdrawal Mechanism for the Illiquid Base mUSDC Market

**URL:** <https://forum.moonwell.fi/t/governance-request-fair-withdrawal-mechanism-for-the-illiquid-base-musdc-market/2230>\
**Category:** Idea\
**Created:** [September 6, 2026, 4:13pm UTC](https://forum.moonwell.fi/t/governance-request-fair-withdrawal-mechanism-for-the-illiquid-base-musdc-market/2230 "2026-09-06T16:13:12Z")\
**Posts on this page:** 1\
**Showing post:** 2

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**Author:** ![Dr\_Bahmani](https://dub1.discourse-cdn.com/flex017/user_avatar/forum.moonwell.fi/dr_bahmani/32/4357_2.png) [@Dr\_Bahmani](https://forum.moonwell.fi/u/Dr_Bahmani)\
**Post date:** [September 7, 2026, 9:28pm UTC](https://forum.moonwell.fi/t/governance-request-fair-withdrawal-mechanism-for-the-illiquid-base-musdc-market/2230/2 "2026-09-07T21:28:15Z")

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**Follow-up: today’s ~$250k repayment demonstrated this issue in practice**

I’d like to add a real example from today that illustrates the concern raised in this thread.

A transaction shared by Moonwell moderation called **Repay Borrow Behalf** on the Base mUSDC Core Market.

At roughly the same time, Anthias data changed from approximately:

- **USDC bad debt: $2.554M**
- to **USDC bad debt: $2.308M**

That is a reduction of approximately **$245.6k**.

Based on the transaction and the corresponding change in Anthias data, this appears to be the protocol reserve repayment associated with **MIP-X66** , rather than a normal supplier deposit.

This is clearly a positive development: real capital is now being used to reduce the shortfall.

However, it also demonstrated the withdrawal problem discussed in this thread.

According to users monitoring the market, the liquidity created by this repayment was consumed within **seconds**.

I personally monitor the mUSDC liquidity closely, but I missed the entire event because I was simply away from my system at that moment.

This raises an important practical issue:

**If meaningful liquidity can appear and disappear within seconds, access to withdrawals effectively depends on who happens to be online at that exact moment — or who is using automated bots.**

Normal suppliers cannot reasonably monitor the market 24/7.

And automated users may have a significant advantage over manual users in capturing newly available liquidity.

For larger positions, this problem becomes even more significant, because a supplier may need multiple substantial liquidity events before being able to exit.

So today’s repayment reinforces the original governance question:

**Should liquidity generated by remediation, protocol reserves, recoveries, or other extraordinary measures be distributed purely through the normal first-come, first-served redemption mechanism?**

Or should governance consider a more equitable mechanism for remediation-related liquidity, such as:

- pro-rata distribution,
- a withdrawal queue,
- snapshot-based claims,
- scheduled redemption windows,
- or another mechanism that does not reward transaction speed or automated bots?

I want to emphasize that **the ~$245k reduction in bad debt is a positive and encouraging development**.

My concern is specifically about how remediation liquidity is distributed once it reaches the market.

If governance is using protocol-controlled resources to repair an impaired market, I believe it is worth discussing whether that liquidity should also be distributed through a mechanism designed specifically for an impaired market.

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_[View the full topic](https://forum.moonwell.fi/t/governance-request-fair-withdrawal-mechanism-for-the-illiquid-base-musdc-market/2230)._