TermMax debates a controversial issue every week, not about right or wrong, but about cognitive collision. Brothers who have free time can check out this week's topic: Is Liquidation a stumbling block for DeFi or an essential step? Nobody likes to be liquidated, but no one can bypass this core DeFi mechanism. In a world without KYC and on-chain governance, is it a bottom line or a shackle? Is it the 'culprit' of brutal liquidations, or the core driver pushing risk management evolution? What is the future direction of liquidation? My view is: liquidation is a bottom line, not an obstacle. Without liquidation, bad debts would accumulate rapidly, and the protocol would not survive. Its purpose is not to punish borrowers but to protect the majority of LPs and the protocol's solvency, and it is a prerequisite for the system's long-term operation. The reason everyone dislikes liquidation is mainly because early liquidation designs were too crude. When prices drop, they cut directly, liquidating entire positions, resulting in poor user experience and amplifying panic and market crashes. But it is precisely this violent liquidation that has driven the evolution of DeFi. Now more and more protocols are introducing Soft Liquidation, Partial Liquidation, such as Curve's LLAMMA, which essentially uses a smoother approach to mitigate risk rather than instantly clearing positions. I believe the future trend is very clear: liquidation will not disappear but will become increasingly seamless. It will be split, mitigated, and absorbed into risk control logic in advance, rather than waiting until the last moment to act. So the issue is not whether to liquidate or not, but whether the liquidation design is smart enough. In my opinion, liquidation is not an obstacle to DeFi innovation; it is itself one of the core forces driving the evolution of DeFi risk management and mechanisms.