Crypto Investment Platform Freeway (FWT) Halts Services – Token Plunges 80%
Freeway, a centralized crypto investment platform that promises clients rewards of up to 43%, halted all service operations on Sunday, October 23rd, citing “unprecedented volatility” in the foreign exchange (FX) and crypto markets.
The value of Freeway’s native token, FWT, plunged more than 80% following the news, and is currently trading at $0.0015 at the time of writing—down more than 95% from its all-time high of $0.03, according to CoinGecko.
The company, which claims to have more than $160 million in total value locked, stated that it would be temporarily halting buy backs of so-called Superchargers. Superchargers are investment products denominated in various crypto and fiat currencies that generate yield when purchased. The measure effectively bars users from withdrawing funds, due to being unable to sell the products.
The firm claims to be looking to diversify its underlying portfolio in an attempt to “manage exposure to future market fluctuations and volatility ensuring the long term sustainability and profitability”.
“We will notify you when we are ready to recommence partial Supercharger simulation purchases (buy-backs) and then again as we can recommence full Supercharger simulation purchases as well as on platform Freeway Token (FWT) Deposits and Buys,” the company explained in a statement.
It appears, however, that the pit is deeper than first anticipated. Twitter user “FatManTerra” noticed that, immediately after Freeway had announced the suspension of services on its platform, the names and photographs of multiple team members started to disappear from the company’s website.
The user was one of the few to sound the alarm, recommending that users immediately withdraw their funds from Freeway, which is seemingly “operating a Ponzi scheme”. FatManTerra also uncovered that the company’s Chief Compliance Officer had left the firm just a few weeks before the incident took place.
Uncanny Similarities to Celsius
The Freeway timeline is eerily similar to that of Celsius, a now-defunct crypto lender that had also offered rewards numbering in the double digits. The once-leading player, with more than $8 billion in loans issued to clients, halted withdrawals in June citing high volatility in the crypto markets.
Just a month later, Celsius filed for ‘Chapter 11‘ bankruptcy, as the filing revealed that the company was $5 billion in debt, with a $1.2 billion hole in its balance sheet. The firm has since been inundated with lawsuits from investors, U.S. states, and other affected entities, while almost the entire executive team has fled the firm.
Those that failed to withdraw their money prior to Celsius halting withdrawals have yet to reclaim their withheld funds. In fact, it is, as yet, unclear whether the victims will ever be issued refunds.
On the Flipside
- There has been no official confirmation of any bankruptcy for Freeway yet;
- Freeway is a much smaller fish than Celsius or Voyager;
- It’s unclear when–if at all–users will be able to sell Superchargers.
Why You Should Care
Freeway is yet another example of a centralized crypto entity that has faced significant turbulance as a result of the ongoing bear market. Investors are advised to be wary of centralized crypto companies offering double-digit rewards.
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Read more: https://dailycoin.com/crypto-investment-platform-freeway-fwt-halts-services-token-plunges-80/
Text source: DailyCoin.com
