By Richard Hines
The cryptocurrency investing platform Midas has taken action by cutting more than 50% from users’ accounts and the rewards assigned to them.
Only roughly 45% of the users’ assets would be available for withdrawal from the site as a result of this action.
Crypto Winter And Market Crisis Affects Midas
The Midas cryptocurrency investment platform has declared that it would be ceasing all of its operations as a result of the devastating losses and events that took place in 2022, ranging from the Luna crash to the Three Arrows Capital catastrophe to the FTX meltdown.
This information was made public in a statement the company delivered on December 27.
The company’s CEO, Trevor Levin, said that his company was affected by the crisis and that it lost more than $50 million out of the $250 million ij the company’s reserve.
Levin ascribed this loss to the speed at which investors withdrew their funds out of the platform following the FTX catastrophe, which upended the market.
The firm’s total liabilities peaked at over $100 million, with liabilities in BTC and Ethereum amounting to over $100 million.
About $50 million of these assets are also held by the company, resulting in a deficit of more than $60 million.
Levin, however, asserted that the firm’s Defi practices were to blame for the asset shortfall that developed. He said that the platform suffered a severe impact from the FTX meltdown, which resulted in this liquidity crunch and the platform’s insolvency.
Levin further emphasized that this company lost money as a result of Defi security hacks and an exorbitant interest return on the company token.
What’s The Plan Moving Forward?
The CEO announced that going ahead, the platform would balance its users by withholding more than 50% from the rewards they have earned and from their accounts, and by letting users take only 45% of their assets.
Hs continued by saying, however, that investors with savings of less than $5000 will only see a reduction impact on their earnings.
Levin concluded by saying that this company will from now on not only conduct its business in a centralized manner utilizing centralized finance, but will also experiment with using centralized decentralized finance in the upcoming year.