Midas CEO Iakov Levin said that after the Terra, FTX and Celsius collapse, users withdrew more than 60% of their assets under management.
Custodial CeDeFi investment platform Midas will close down its operations because of a $63.3 million deficit in its decentralized finance (DeFi) portfolio.
In an announcement, the company’s founder and CEO Iakov Levin also known as “Trevor” wrote that the move is partly because the fund’s DeFi portfolio lost $50 million, which is 20% of its $250 million assets under management (AUM).
In addition, Levin also highlighted that the collapse of the Terra, FTX exchange and Celsius contributed to their struggles. The Midas founder noted that their users withdrew 60% of the funds after the LUNA, Celsius and FTX debacles. Levin wrote:
“We experienced an outflow of assets of more than 60% over the course of six months due to events involving LUNA, Celsius, and FTX. This made it impossible for us to sustain our fixed yield model.”
According to the announcement, the company’s total liabilities in Bitcoin (BTC), Ether (ETH) and stablecoins are at $115 million while their current assets are worth around $51.7 million. This creates a total of $63.3 million in deficit.
The founder also noted that Midas is planning to eventually offer CeDeFi strategies for CeFi and DeFi users, creating a new project in hopes to create a new “win-win situation.” Levin said that it will connect competing protocols through liquidity.
Related: Alameda wallets become active days after SBF bail, community mulls foul play
Meanwhile, after recently revealing how it plans to refund users, DeFi platform Defrost Finance finally broke its silence over accusations of performing a “rug pull” after the recent $12 million exploit within its platform. The Defrost team told Cointelegraph that a compromised key does not equate to a rug pull.
In other DeFi news, Avraham Eisenberg was recently arrested and charged. In a complaint made public on Dec. 27, the Federal Bureau of Investigation pinned Eisenberg with commodities fraud and commodities manipulation because of the Mango Markets exploit.
