Iakor Levin, the CEO of decentralized finance (DeFi) protocol Midas Investments, announced via a statement that the platform was no longer able to provide its services. And for good reason, a significant fragility resulting from the bankruptcies of Celsius and FTX, all combined with massive user withdrawals.
Midas ceases operations
Midas Investmentsa platform dedicated to returns on cryptocurrencies thanks to decentralized finance tools (DeFi), announce to close its doors permanently.
According to the statement written by the CEO of Midas, Iakor LevinMidas reportedly lost a cumulative $50 million, i.e. 20% of its assets under managementjust for the spring of 2022. This coincides with the period in which cryptocurrency lender Celsius found itself in trouble shortly before filing for bankruptcy.
But the collapse of Celsius combined with recent events affecting FTX finally got the better of Midas, which is no longer able to cope with the massive withdrawals from its platform :
“After the Celsius and FTX events, the platform saw withdrawals of over 60% of its AUM [fonds sous gestion, NDLR], creating a significant asset deficit. Based on this situation and current CeFi market conditions [finance traditionnelle, NDLR], we have made the difficult decision to close the platform. »
This is despite various attempts to raise funds or diversify Midas’ investments. Therefore, the platform has blocked the swap and deposit functionalities for a few days in order to determine at what ratio users will be able to withdraw their funds.
Thus, at the latest information, Midas users with funds on the platform will be forced to withdraw their capital gain with an applied penalty of 55%.
👉 Discover our guide to storing and securing your cryptocurrencies
The all-in-one crypto app
0 fees for your 1st crypto purchase 🔥 (up to $200)
The start of something else
In order to bounce back, Midas will work on a new project from January 2023. The latter should focus on the hybrid system of CeDeFi, a mixture of traditional finance (CeFi) and decentralized finance. In theory, this relatively new system aims to provide more secure and transparent solutions.
According to the CEO of Midas, this is a response to growing demand from investors:
“The Midas team estimates that demand for transparent DeFi resources from retail and institutional clients will reach approximately $100 billion in the next five years. To meet this demand, Midas plans to offer scalable, on-chain, verifiable and tokenized CeDeFi strategies for CeFi and DeFi users. »
According to the statement, holders of the Midas token (which bears the same name) will receive a portion of the revenue from the protocol when it goes live. The launch of this new protocol is scheduled for March in its first private test phase..
👉 Read also – Nexo’s acquisition of Vauld is in jeopardy, but Nexo is not letting go
The best way to secure your cryptocurrencies 🔒
🔥 The world leader in crypto security
Source: Press release
Newsletter 🍞
Receive a summary of crypto news every Monday by email 👌
What you need to know about affiliate links. This page presents assets, products or services relating to investments. Some links in this article are affiliated. This means that if you buy a product or register on a site from this article, our partner pays us a commission. This allows us to continue to offer you original and useful content. There is no impact on you and you can even get a bonus by using our links.
Investments in cryptocurrencies are risky. Cryptoast is not responsible for the quality of the products or services presented on this page and could not be held responsible, directly or indirectly, for any damage or loss caused following the use of a good or service highlighted in this article. Investments related to crypto-assets are risky by nature, readers should do their own research before taking any action and only invest within the limits of their financial capabilities. This article does not constitute investment advice.
AMF recommendations. There is no guaranteed high return, a product with high return potential involves high risk. This risk-taking must be in line with your project, your investment horizon and your ability to lose part of this savings. Do not invest if you are not ready to lose all or part of your capital.
To go further, read our Financial Situation, Media Transparency and Legal Notices pages.
Passionate about the world of decentralized finance and the novelties brought by Web 3.0, I write articles for Cryptoast to help make blockchain more accessible to everyone. Convinced that cryptocurrencies will change the future very soon.
Maximilien Prue
527 items
