Due to catastrophic financial losses caused by Celsius’ collapse and FTX’s catastrophe, cryptocurrency exchange Midas Investments suspended deposits and swaps.
Iakov Levin, the CEO, has stated that next year the company will concentrate on a new initiative that will be completely transparent and provide an enhanced investing experience.
Another Victim
Midas Investments’ founder and CEO announced the platform’s closure in a blog post published on December 27. After a brief period during which withdrawals were temporarily blocked for the proper computations, customers were permitted to withdraw their remaining funds minus the appropriate deductions.
In this article, we want to share with you the story of what led us to this difficult decision, provide you with an overview of our balance sheets, P&L, and DeFi portfolio composition, and give you some insight into our plans for the future.
Link: https://t.co/Oa6uTDYN6L pic.twitter.com/3mIg4fAK7l
— Midas.Investments (@Midas_platform) December 27, 2022
After removing 55% and any earned awards, Levin disclosed that they would update user balances by balancing any leftover obligations in BTC, ETH, and stablecoins with any remaining assets.
None of your BNB, AVAX, or FTM balances will be affected. Reimbursement to affected customers based on their deducted amount, including BNB, AVAX, and FTM, will not be impacted.
Levin predicts that interest in Decentralised Finance (DeFi) will skyrocket in the next five years among retail and institutional clients. With this in mind, Midas Investments plans to provide scalable, on-chain, verifiable, tokenised CeDeFi methods for users of both CeFi and DeFi.
A new project based on principles of complete transparency and its native cryptocurrency is also on the company’s agenda. Eventually, the company will stop trading MIDAS tokens and replace them with something else.
The CEO expressed regret to any affected users for the sudden shutdown of the service. He encouraged optimism by saying it was not the end but rather the beginning of something new. The proposed changes would be the most effective means of addressing the existing issues. He was sorry to hear of any financial losses at Midas, and he would do all in his power to make up for the previous venture’s failures.
What Caused the Issue?
After the fall of crypto titans Celsius and FTX this spring, Levin said his business lost about $50 million when users withdrew a significant portion of their assets.
Midas Investments noted that the extensive withdrawals due to the insolvency of Celcius and FTX, coupled with reduced yield opportunities on the market, made it impossible to cover daily payouts to users due to the assets deficit.
Many businesses were adversely affected by the FTX debacle because it had a domino effect. BlockFi filed for bankruptcy protection, while the Japanese bitcoin exchange Liquid Global and the cryptocurrency lender Genesis Global Capital blocked withdrawals.
BlackRock, Tiger Global Management, Temasek, Galois Capital, and other major financial institutions lost millions in investing in FTX.