More cryptocurrency lenders are struggling to stem the flow of withdrawals

A coin with the Bitcoin logo dipped in some snow.

picture: SIVStockStudio (stock struggle)

The number of crypto-lending platforms that actually allow users to take their cryptocurrency home with them is gradually decreasing. One company even reported that its users have been draining their accounts with nearly $198 million in total over the past three weeks.

CoinLoan announce On Monday, it was placing significant limits on users’ ability to withdraw most of their crypto assets. On the same day, Fuld essentially gave her clients a paternal pat on the head, telling them “It’s for your own good,” while canceling withdrawals altogether. The latter company is reportedly looking for its own “Daddy Warbucks” to help the company weather the cold, cruel hellencryption winter. “

CoinLoan told users on its blog that it was limiting the total amount of daily withdrawals to just $5,000 in a 24 hour period in an effort to limit the flow of withdrawals to a small extent. The company said so It would lift the restriction “as soon as the market situation permits”.

It’s about a 99% drop in the total withdrawal limit from where it was originally $500,000. The company continued to pat itself on the back for not stopping all withdrawals at all “as some other companies have done,” adding that “users who entrusted their money to us are our biggest priority.”

Cryptocurrency users are looking to abandon some ships en masse, and companies are using cork stoppers to plug holes in their sinking ships. Fold CEO Darshan Bateja wrote on the company’s blog that the suspension of withdrawals was due to “a combination of circumstances such as volatile market conditions, the financial difficulties of our major trading partners inevitably affecting us, and the current market climate which has resulted in a significant amount of customer withdrawals increasing About US$197.7 [million] Where [June 12]. “

The two companies join a host of other crypto platforms including CoinflexAnd the Celsius, Binance That halted or significantly limited withdrawals. Singapore based fold It recently reduced its total headcount by 30%, according to email data from executives sent to Moneycontrol. Other companies like BlockFi and Crypto.com They announced similar drastic cuts due to the preservation of the price of the cryptocurrency bear market situation.

Batega wrote that they were discussing the moves with potential investors. Reuters On Tuesday, it reported that London-based crypto lending platform Nexo is considering buying Fuld “to accelerate its deeper presence in Asia.” There is no information yet on how much it might be of value. Reuters cited an Indian newspaper Hindu Business Line previously reported by the company 1 billion dollars in assets And he wanted to cross $5 million this year.

Although Nexo is considering expanding into the crypto world, many bears are still skeptical about the health of the incredibly unregulated industry. Three Arrows Capital – a massive crypto hedge fund – recently defaulted on millions of bitcoin loans and was ordered to liquidation of its assets by a Virgin Island court last week. This does not mean that there is no big money It is still being pushed into some crypto projects from investment firms looking to prop up the struggling crypto market.

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