by • Midas Investments is closing down operations due to a $63.3 million deficit in its decentralized finance (DeFi) portfolio.
• The company’s total liabilities in Bitcoin, Ether and stablecoins are at $115 million while their current assets are worth around $51.7 million.
• The closure is partly due to the collapses of Terra, FTX and Celsius, which caused users to withdraw more than 60% of their assets under management.
Midas Investments, a custodial investment platform, is shutting down operations due to a $63.3 million deficit in its decentralized finance (DeFi) portfolio. This is a substantial decrease from its $250 million assets under management (AUM). The closure is partly due to the collapses of Terra, FTX and Celsius, which caused users to withdraw more than 60% of their assets under management.
The company’s total liabilities in Bitcoin, Ether 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. Midas founder and CEO Iakov Levin, also known as “Trevor,” addressed the difficult decision in an announcement, stating that the outflow of assets over the course of six months made it impossible for them to sustain their fixed yield model.
Terra, FTX and Celsius all experienced collapses in the past few months which caused a significant decrease in the amount of assets managed by Midas. The company’s losses are mainly attributed to this, as people withdrew more than 60% of their funds in response to these events.
The closure of Midas Investments marks a sad occasion for the crypto community. It serves as a reminder of just how volatile the market can be and how quickly things can change. Despite their best efforts, Midas was unable to sustain their business model in the face of these market conditions. It is likely that similar businesses will face similar struggles in the near future as the industry continues to grow and evolve.
